College of ê>L Clçabetï) CONVENT STATION, N. J. â>anta Jllana >all 346*4 ïibrarp ilo............... 83^70..... For REFERENCE NOT TO BE TAKEN FROM THIS ROOM discarded APR 1 9 Z006 CSE I UNITED STATES REPORTS VOLUME 303 CASES ADJUDGED IN THE SUPREME COURT AT OCTOBER TERM, 1937 From January 18, 1938, to and Including April 11, 1938 ERNEST KNAEBEL REPORTER UNITED STATES GOVERNMENT PRINTING OFFICE WASHINGTON : 1938 For sale by the Superintendent of Documents, Washington, D. C. - Price $2.00 (Buckram) 3^' L/p ^1' JUSTICES OF THE SUPREME COURT DURING THE TIME OF THESE REPORTS 1 CHARLES EVANS HUGHES, Chief Justice. JAMES CLARK McREYNOLDS, Associate Justice. LOUIS D. BRANDEIS, Associate Justice. PIERCE BUTLER, Associate Justice. HARLAN FISKE STONE, Associate Justice. OWEN J. ROBERTS, Associate Justice. BENJAMIN N. CARDOZO, Associate Justice.2 HUGO L. BLACK, Associate Justice. STANLEY REED, Associate Justice.3 RETIRED WILLIS VAN DE VANTER, Associate Justice. GEORGE SUTHERLAND, Associate Justice.4 HOMER S. CUMMINGS, Attorney General. STANLEY REED, Solicitor General.3 ROBERT H. JACKSON, Solicitor General.5 CHARLES ELMORE CROPLEY, Clerk. FRANK KEY GREEN, Marshal. For references see following page. III ’For allotment of the Chief Justice and Associate Justices among the several circuits, see next page. 2Mr. Justice Cardozo was absent from the bench, on account of illness, during the period covered by this volume. 8Mr. Stanley Reed, of Kentucky, was nominated to be Associate Justice by President Roosevelt on January 15, 1938; the nomination was confirmed by the Senate on January 25; the commission issued January 27; and he took the constitutional and judicial oaths and was seated on January 31. 4Mr. Justice Sutherland, by letter to the President of January 5th, communicated his intention to retire on the 18th of that month, as authorized by Act of March 1, 1937, c. 21, 50 Stat. 24. See p. VI. bMr. Robert H. Jackson, of New York, was nominated to be Solicitor General by President Roosevelt on January 27, 1938; the nomination was confirmed by the Senate March 4; and he was commissioned and took the oath of office March 5. IV SUPREME COURT OF THE UNITED STATES. ALLOTMENT OF JUSTICES It is ordered that the foliowing allotment be made of the Chief Justice and Associate Justices of this Court among the circuits, agreeably to the acts of Congress in such case made and provided, and that such allotment be entered of record, viz : For the First Circuit, Louis D. Brandeis, Associate Justice. For the Second Circuit, Harlan F. Stone, Associate Justice. For the Third Circuit, Owen J. Roberts, Associate Justice. For the Fourth Circuit, Charles Evans Hughes, Chief Justice. For the Fifth Circuit, Hugo L. Black, Associate Justice. For the Sixth Circuit, James C. McReynolds, Associate Justice. For the Seventh Circuit, Benjamin N. Cardozo, Associate Justice. For the Eighth Circuit, Pierce Butler, Associate Justice. For the Ninth Circuit, Stanley Reed, Associate Justice. For the Tenth Circuit, Pierce Butler, Associate Justice. February 7, 1938. (For next previous allotment, November 8, 1937, see 302 U. S., p. iv.) v RETIREMENT OF MR. JUSTICE SUTHERLAND. On January 7, 1938, it was ordered by the Court that the accompanying correspondence between members of the Court and Mr. Justice Sutherland be spread upon the minutes and that it also be printed in the reports of the Court. Suprême Court of the United States WASHINGTON, D. C. January 6, 1938. My dear Justice Sutherland: Upon your retirement from regular active service on the bench, we wish to give you renewed assurance of our warm affection and of our high appréciation of the dis-tinguished ability and unremitting dévotion which hâve characterized your long participation in the work of the Court. Not only hâve you brought to our deliberations learning and dialectical skill, a wide knowledge of affairs enriched by varied and eminent public service, and a habit of thoroughness and précision, but you hâve matched tenacity of purpose with an unvarying kindli-ness and hâve mellowed our deliberations with unfailing humor. We keenly regret the loss of this companionship which will ever remain a delightful memory. We trust that in your retirement from the constant labor of active service you will find fresh vigor and the abiding satisfaction which cornes from the consciousness of arduous duties performed. with complété fidelity. Faithfully yours, Charles E. Hughes. J. C. McReynolds. Louis D. Brandeis. Pierce Butler. Harlan F. Stone. Owen J. Roberts. Benjamin N. Cardozo. Hugo L. Black. Mr. Justice Sutherland. VI RETIREMENT OF MR. JUSTICE SUTHERLAND. Suprême Court of the United States WASHINGTON, D. C. January 7, 1938. My dear Brethren : I hâve read your letter, and make my reply to it with mingled émotions of gratitude for the more than générons things you say, and sorrow that these amenities end the completeness of that close and affectionate comradeship which reaches back so many years. It is very hard for me to step out of this circle, where I hâve taken comfort for so long. I leave the Court with keen regret. I hâve loved the work in which we hâve been engaged together; and only a definite conviction that the time has corne reconciles me to the unwelcome thought of laying it down. The memory of our association will remain; but this, although very dear, will not compensate me for the loss of the reality. May health and happiness attend you ail throughout the coming years. Very sincerely yours, Geo. Sutherland. The Chief Justice. Mr. Justice McReynolds. Mr. Justice Brandeis. Mr. Justice Butler. Mr. Justice Stone. Mr. Justice Roberts. Mr. Justice Cardozo. Mr. Justice Black. VII TABLE OF CASES REPORTED Page. Abbott v. Morgenthau.......................... 638 Abbott v. Pratt............................... 621 Abel v. Kennedy............................... 667 Aberdeen Motor Supply Co. v. Trust Co...... 639, 667 Adair v. Bank of America Assn................. 350 Adam v. Saenger.......................... 59, 666 Adams v. Nagle............................ 532, 620 Adams v. Tobias........................... 532, 620 Adams v. United States.................... 644, 668 Adler v. Cincinnati........................... 622 Aetna Insurance Co. v. United Fruit Co........ 631 Alexander, Atlanta Beer Co. v................. 644 Allbritton v. Winona.......................... 627 Allen v. Regents of University System......... 634 Almours Securities v. Commissioner............ 666 Alsop v. Helvering.......................... 666 American Concrète Expansion Joint Co. v. High-way Appliances Co............................. 653 American Snuff Co. v. Commissioner............ 662 American Surety Co. v. Hamden................ 648 Anderson, Indiana ex rel., v. Brand........ 95, 667 Annett v. New York, N. H. & H. R. Co.......... 650 Arkansas-Louisiana Pipe Line Co., Coverdale v.... 604 Associated Indemnity Corp. v. Getty Oil Co...... 644 Atkinson v. State Tax Comm’n................... 20 Atlanta Beer Distributing Co. v. Alexander...... 644 Atlantic City, Kelley v........................... 666 Atlantic Coast Line R. Co. v. Batton.......... 651 Atlantic Refining Co. v. Smith................ 658 Awotin v. Healy............................... 650 Baker, United States v........................ 642 IX X TABLE OF CASES REPORTED. Page. Ballard, Spruill v............................. 666 Baltimore & Ohio R. Co. v. Love................ 648 Bankers Life Co. v. Littlefield................ 654 Bankline Oil Co. v. Commissioner............... 362 Bankline Oil Co., Helvering v.................. 362 Bank of America Assn., Adair v................. 350 Barnwell Bros., S. C. Highway Dept. v...... 177,625 Bâtes Manufacturing Co. v. United States... 567, 628 Batton, Atlantic Coast Line R. Co. v........... 651 Belk v. Massman Construction Co............ 641 Bethlehem Shipbuilding Corp., Myers v........... 41 Blackton v. Gordon.............................. 91 Blair v. T. W. Warner Co..................... 664 Bleecker, Ex parte.............................. 617 Board of Education, Groves v............... 622, 669 Bonet v. Quilès................................* 662 Bonet v. Valiente & Co......................... 662 Bostic v. United States........................ 635 Boston Insurance Co. v. United Fruit Co......... 631 Boston Machine Works Co. v. Prime Mfg. Co....... 660 Bothwell v. United States...................... 645 Bowers, Helvering v........................ 618, 667 Boyle, Hipp v.................................. 637 Brady v. Terminal Railroad Assn................. 10 Brainard v. Commissioner....................... 665 Brand, Indiana ex rel. Anderson v........... 95, 667 Briggs & Stratton Corp., Ignition Co. v........ 661 Brooklyn & Queens Transit Corp. v. New York.... 573 Brooklyn Trust Co. v. Sherman Square Apts....... 658 Brown v. Brown................................. 642 Brown, Brown v................................. 642 Brown-Crummer Investment Co. v. Hamlin..... 664 Brown-Crummer Investment Co., Océan Beach Heights v...................................... 666 Bull v. United States.......................... 645 Bullard, Helvering v......................... 297 Bureau of Revenue, Western Live Stock v........ 250 TABLE OF CASES REPORTED. xi Page. Burke Grain Co. v. Saint Paul Co................ 661 Byrd-Frost, Inc., v. Elder...................... 647 Calmar Steamship Corp. v. Taylor................ 525 Calmar Steamship Corp., Taylor v................ 643 Capone v. United States......................... 651 Caputo, President ex rel., v. Kelly............. 635 Carter v. Marvel Carburetor Co.................. 640 Caterpillar Tractor Co., Paridy v............... 657 Century Indemnity Co. v. Nelson................. 213 Century Productions v. Patterson................ 655 Chandler v. Wise................................ 634 Chicago, B. & Q. R. Co., Clarke v........... 635, 668 Chicago, B. & Q. R. Co. v. Goodman.............. 640 Cincinnati, Adler v............................. 622 Clarke v. Chicago, B. & Q. R. Co............ 635, 668 Cleveland, East Ohio Gas Co. v.................. 657 Cleveland Trust Co., Aberdeen Co. v........ 639, 667 Cleveland Trust Co., Rowe Sales Co. v...... 639, 667 Cleveland Trust Co., Schriber-Schroth Co. v... 639, 667 Cochrane v. United States....................... 636 Cogg, Ex parte.................................. 620 Cohen v. Maryland....................... •...... 660 Coleman, McQuillan v............................ 637 Coleman v. Miller............................... 632 Collins, Zerbst v............................... 632 Commissioner, Almours Securities v.............. 666 Commissioner, American Snuff Co. v.............. 662 Commissioner, Bankline Oil Co. v................ 362 Commissioner, Brainard v........................ 665 Commissioner, Fort Pitt Bridge Works v.......... 659 Commissioner, Foster v...................... 618, 667 Commissioner, Guaranty Trust Co. v.............. 493 Commissioner, Barman v....................... 650 Commissioner, McLoughlin v...................... 218 Commissioner, Sharp v........................... 624 Commissioner, Sterling v....................... 663 Commissioner, Taft v............................ 631 XII TABLE OF CASES REPORTED. Page. Committee on Education & Labor, Silvershirt Légion v....................................... 627 Compania Espanola v. The Navemar................ 68 Connecticut, Heller v.................... i....... 627 Connecticut General Ins. Co. v. Johnson......... 77 Consolidated Water Co., New York ex rel., v. Maltbie....................................... 158 Corbett v. Equitable Life Society.............. 647 Corden Corp., Williams v....................... 659 Cortez Cigar Co. v. Fidelity-Phenix Co......... 636 Cortez Cigar Co., Fidelity-Phenix Co. v........ 636 Cosman v. United States....................... 617 Coughran, State Farm Ins. Co. v.................485 Coverdale v. Arkansas-Louisiana Pipe Line Co..... 604 Cox, Pollitt v................................. 634 Crowther, Marshall County Bank v............... 653 Cudahy Bros. Co., LaBudde v................... 659 Cudahy Packing Co. v. McBride.................. 639 Danish v. Sofranski............................ 641 Davidowicz, Klipstein v......................... 648 Deitrick v. Standard Surety Co................. 471 Dempsey v. Pink................................ 648 Dempsey, Pink v................................ 648 Department of Financial Institutions, Mercantile- Commerce Bank & T. Co. v....................... 656 Dip v. United States........................... 638 Di Santo v. United States...................... 662 Ditsch v. United States..................... 644, 668 Doherty v. United States....................... 658 Dowling v. Western Union Telegraph Co.......... 650 Drummond v. United States................... 644, 668 Dubrin v. United States........................ 646 Duke, Ex parte................................ 625 Dumaine, Golding Bros. Co. v................... 660 Dutchess Underwear Corp. v. Industrial Rayon Corp........................................... 640 Dyer, Simpson v............................. 642, 669 TABLE OF CASES REPORTED. XIII Page. East Ohio Gas Co. v. Cleveland................. 657 Edgar Bros. Co. v. State Revenue Comm’n........ 626 E. G. Shinner & Co., Lauf v................... 323 Elbe Oil Land Co., Helvering v................. 372 Elder, Byrd-Frost, Inc. v....................... 647 Electric Bond & Share Co. v. Securities & Exchange Comm’n...................................... 419, 617 Equitable Life Ins. Society, Corbett v............. 647 Escanaba & Lake Superior R. Co. v. United States... 315 Esnault-Pelterie, United States v......... i....... 26 Ex parte. See name of party. Farmers & Merchants Nat. Bank Co., Massey v.... 665 Fédéral Communications Comm’n, Missouri Broad- casting Corp. v............................. i. 655 Fédéral Trade Comm’n v. Goodyear Tire Co........ 631 Fellows v. United States....................... 636 F. E. Rowe Sales Co. v. Cleveland Trust Co.. 639, 667 Fidelity-Phenix Fire Ins. Co. v. Cortez Co...... 636 Fidelity-Phenix Fire Ins. Co., Cortez Co. v..... 636 Finney, Maynard v.............................. 648 Florida, Poole v............................... 619 Fort Pitt Bridge Works v. Commissioner......... 659 Foster v. Commissioner..................... 618, 667 Foster v. United States........................ 118 Fowler, United States v.......................... 665 Freedman, Helvering v...........................218 Gage v. Leonard................................ 653 Gamer, New York Life Ins. Co. v................ 161 Geiselman, New York ex rel., v. Hunt........... 639 General Electric Co., Wabash Corp. v....... 641, 667 George F. Getty Oil Co., Indemnity Corp. v...... 644 Gerhardt, Helvering v.......................... 630 Getty (George F.) Oil Co., Indemnity Corp. v.... 644 Gibbons, Ex parte.............................. 617 Glenn v. Smith................................. 657 Goess, Willcox v.............................. 3; 647 Goldberg v. McCauley........................... 636 Golding Bros. Co. v. Dumaine................... 660 XIV TABLE OF CASES REPORTED. Page. Goodman, Chicago, B. & Q. R. Co. v............. 640 Goodyear Tire & R. Co., Trade Comm’n v........... 631 Gordon, Blackton v.............................. 91 Grasselli Chemical Co., Maty v............... 197 Great Northern Ry. Co. v. Leonidas............. 632 Greyhound Lines, National Labor Board v.... 261, 272 Grifîin, United States v....................... 226 Griffin, City of, Lovell v..................... 444 Gross, Ex parte................................ 621 Groves v. Board of Education............... 622, 669 Grunwald v. United States...................... 663 Guaranty Trust Co. v. Commissioner............. 493 Guaranty Trust Co. v. Virginia................. 632 Gunnarson, Robert Jacob, Inc. v................ 660 Haie v. Kentucky........................... 613, 629 Hall, Pollitt v................................ 641 Hamden, American Surety Co. v............... 648 Hamilton National Bank, McCollum v............. 245 Hamlin, City of, Brown-Crummer Investment Co. v......................................... 664 Hardesty, Hood v............................... 661 Harding v. Kentucky Title Trust Co............. 635 Hardt, Kirkpatrick v........................... 626 Harman v. Commissioner......................... 650 Harriss v. Indemnity Ins. Co................... 645 Hassett v. Welch............................... 303 Healy, Awotin v................................ 650 Heller v. Connecticut.......................... 627 Helvering, Alsop v............................. 666 Helvering v. Bankline Oil Co................. 362 Helvering v. Bowers........................ 618, 667 Helvering v. Bullard......................... 297 Helvering v. Elbe Oil Land Co................. 372 Helvering v. Freedman......................... 218 Helvering v. Gerhardt........................ 630 Helvering v. Marshall......................... 303 Helvering v. Mitchell......................... 391 TABLE OF CASES REPORTED. xv Page. Helvering v. Mountain Producers Corp............ 376 Helvering v. Mulcahy............................ 630 Helvering v. National Grocery Co................ 630 Helvering v. O’Donnell.........................'. 370 Helvering v. Therrell........................... 218 Helvering v. Tunnicliffe........................ 218 Helvering v. Wilson............................. 630 Helvering v. Winmill............................ 633 Hendler, United States v........................ 564 Henneford v. Northern Pacific Ry. Co............. 17 Hering v. State Board of Education.............. 624 Highway Appliances Co., American Joint Co. v.... 653 Hill v. Railroad Industrial Finance Co.......... 634 Hipp v. Boyle................................... 637 Holman v. United States..................... 644, 668 Hood v. Hardesty................................ 661 House, Ex parte................................. 626 Howard, U. S. ex rel. Willoughby v.............. 666 Humphries, Ex parte............................. 625 Hunt, New York ex rel. Geisehnan v.............. 639 Hunt, New York ex rel. Kurzynski v.............. 654 Hyland v. Millers National Ins. Co.............. 645 Illinois Central R. Co., United States v........ 239 Indemnity Insurance Co., Harriss v.............. 645 Indiana ex rel. Anderson v. Brand............ 95, 667 Indiana ex rel. Valentine v. Marker............. 628 Industrial Rayon Corp., Dutchess Corp. v........ 640 Inghram, Union Stock Yard Co. v................. 649 International Manufacturers Sales Co. v. United States.......................................... 651 Isackson v. School District No. 37.............. 636 J. A. Livingston, Inc. v. Pocono Cloth Co....... 637 Jennings v. Pratt............................... 621 Johnson, Connecticut General Co. v............... 77 Johnson v. M. G. West Co........................ 666 Johnson v. Zerbst............................... 629 Jones, Zerbst v................................. 633 XVI TABLE OF CASES REPORTEE. Page. Jordon v. United States......................... 654 Kansas Farmers Union Co. v. Shaffer............. 623 Kansas Gas & Electric Co. v. McPherson.......... 624 Kaplan, United States v......................... 629 Kaufman Compress Co., St. Paul Ins. Co. v........ 653 Kay v. United States.............................. 1 Keller v. Zerbst................................ 637 Kelley v. Atlantic City......................... 666 Kelly, President ex rel. Caputo v............... 635 Kennedy, Abel v................................. 667 Kentucky, Haie v............................ 613,629 Kentucky Macaroni Co., London & Provincial Ins. Co. v........................................... 652 Kentucky Macaroni Co., Royal Ins. Co. v......... 652 Kentucky Title Trust Co., Harding v............. 635 Kidwell, Zerbst v............................... 632 Kirkpatrick v. Hardt............................ 626 Klein, United States v.......................... 276 Klipstein v. Davidowicz......................... 648 Kosolapoff v. Petrogradsky Bank................. 659 Kurzynski, New York ex rel., v. Hunt............ 654 Labor Board. See National Labor Board. LaBudde v. Cudahy Bros. Co...................... 659 Lauf v. E. G. Shinner & Co...................... 323 Lee, Ex parte................................... 624 Lee v. Plummer.................................. 658 Leibowitt, Stein v.............................. 652 Leonard, Gage v................................. 653 Leonidas, Great Northern Ry. Co. v.............. 632 Levey v. United States.......................... 639 Lincoln Engineering Co. v. Stewart-Warner Corp... 545 Lindsey, Ex parte............................... 617 Lindsey v. Washington....................... 654,669 Lindway, Ex parte............................... 627 Little v. United States......9............. 644, 668 Littlefield, City of, Bankers Life Co. v........ 654 Livermore v. Mandeville & Thompson.... 653 Live Stock National Bank, Schultz v............. 666 TABLE OF CASES REPORTED. xvn Page. Livingston (J. A.), Inc. v. Pocono Rubber Co... 637 Logan v. Stanolind Oil & Gas Co............... 636 London & Provincial Marine & G. Ins. Co. v. Ken- tucky Macaroni Co............................. 652 Lonergan v. United States...................... 33 Love, Baltimore & Ohio R. Co. v............... 648 Lovell v. City of Grifiin..................... 444 Lowe Brothers Co. v. United States............ 633 Lubitzky v. United States..................... 663 Lupo v. Zerbst................................ 646 Luteran v. United States.................. 644, 668 MacAndrews & Forbes Co., Mechanical Mfg. Co. v... 655 Mackay Radio & Telegraph Co., Labor Board v....630 MacKenzie, Myers v............................. 41 Mackenzie-Kennedy v. United States............. 646 Maltbie, N. Y. ex rel., Consolidated Water Co. v... 158 Mandeville & Thompson, Livermore v............. 653 Marker, Indiana ex rel. Valentine v........... 628 Marshall, Helvering v......................... 303 Marshall County Bank v. Crowther.............. 653 Martineau, U. S. ex rel. Pannone v............ 643 Marvel Carburetor Co., Carter v............... 640 Maryland, Cohen v............................. 660 Massey v. Farmers & Merchants Bank Co.......... 665 Massman Construction Co., Belk v.............. 641 Maty v. Grasselli Chemical Co................. 197 Maynard v. Finney............................. 648 McBride, Cudahy Packing Co. v.........z....... 639 McCauley, Goldberg v...........................636 McCollum v. Hamilton National Bank............ 245 McDonald v. United States..................... 622 McDonough (M.) Co. v. Waldorf System........... 663 McGoldrick v. National Cash Register Co....... 656 McGoldrick v. West Publishing Co.............. 656 McGrath, Washington v........................ 651 McLoughlin v. Commissioner.................... 218 McPherson, Kansas Gas & Electric Co. v........ 624 53383°—38-----H XVIII TABLE OF CASES REPORTED. Page. McQuillen, Ex parte........................... 619 McQuillen v. Coleman.......................... 637 Mechanical Manufacturing Co. v. MacAndrews & Forbes Co..................................... 655 Mercantile-Commerce Bank & T. Co. v. Dept. of Financial Institutions........................ 656 Metropolitan Life Ins. Co., Roberts v......... 660 M. G. West Co., Johnson v...................... 666 Middle States Petroleum Corp. v. United States.... 645 Miller, Coleman v............................. 632 Millers National Ins. Co., Hyland v........... 645 Miner (W. H.), Inc., Peerless Equipment Co. v... 641 Missouri v. lowa.............................. 628 Missouri Broadcasting Corp. v. Fédéral Communications Comm’n.................................. 655 Mitchell, Helvering v......................... 391 M. McDonough Co. v. Waldorf System............ 663 Mookini v. United States...................... 201 Mooney v. Smith............................... 620 Moor, United States v......................... 663 Moran v. United States..................... 643, 669 Morgenthau, Abbott v.......................... 638 Moulding-Brownell Corp. v. Sullivan........... 638 Mountain Producers Corp., Helvering v..........376 Mrazek, Terminal Railroad Assn. v............. 656 Mulcahy, Helvering v.......................... 630 Munro v. United States......................... 36 Murphy v. Zerbst.............................. 650 Myers v. Bethlehem Shipbuilding Corp........... 41 Myers v. MacKenzie............................. 41 Nagle, Adams v............... ............. 532, 620 Nashville, C. & St. L. Ry. v. Railway Employées’ Dept.......................................... 649 National Cash Register Co., McGoldrick v........ 656 National Grocery Co., Helvering v............. 630 National Labor Board v. Mackay Radio & T. Co... 630 National Labor Board v. Pacific Greyhound Lines.. 272 TABLE OF CASES REPORTED. XIX Page. National Labor Board v. Pennsylvania Greyhound Lines.......................................... 261 National Labor Board, Santa Cruz Co. v.......... 453 Navemar, The, Compania Espanola v............... 68 Neeper v. United States.................... 644, 668 Nelson, Century Indemnity Co. v................ 213 Newhouse, Wyman v.............................. 664 New Negro Alliance v. Sanitary Grocery Co.......552 Newport News Shipbuilding & Dry Dock Co. v. Schauffler...................................... 54 New York City, Brooklyn & Queens Transit Corp. v. 573 New York City, New York Rapid Transit Corp. v... 573 New York ex rel. Consolidated Water Co. v. Maltbie 158 New York ex rel. Geisehnan v. Hunt............. 639 New York ex rel. Kurzynski v. Hunt............. 654 New York Life Ins. Co. v. Gamer................ 161 New York, N. H. & H. R. Co., Annett v.......... 650 New York Rapid Transit Corp. v. New York........573 Northern Pacific Ry. Co., Henneford v........... 17 Océan Beach Heights v. Brown-Crummer Inv. Co... 666 O’Donnell, Helvering v......................... 370 O’Donnell, United States v.................... 501 Oklahoma, Southwestern Bell Tel. Co. v......... 206 One 1936 Model Ford, United States v........... 633 Oughton, Rabinovitz v........................ 649 Outlet Embroidery Supply Co., Szold v.......... 623 Owens, Zerbst v................................ 633 Pacific Gas & Electric Co. v. Sacramento Municipal Utility Dist................................. 640 Pacific Greyhound Lines, National Labor Board v... 272 Palka v. Walker................................ 628 Palmer, Ex parte............................... 628 Pannone, U. S. ex rel., v. Martineau........... 643 Paridy v. Caterpillar Tractor Co............... 657 Patryas, United States v....................... 341 Patterson, Century Productions v............... 655 Peel, Zerbst v................................. 633 XX TABLE OF CASES REPORTEE. Page. Peerless Equipment Co. v. W. H. Miner, Inc........ 641 Pennsylvania Greyhound Lines, Labor Board v....... 261 Petrogradsky Bank, Kosolapoff v.............. 659 Phillips, Ex parte............................... 619 Phillips v. Tarrier Co........................... 655 Phillips v. United States........................ 649 Pickett v. Trixler............................... 652 Pink v. Dempsey.................................. 648 Pink, Dempsey v.................................. 648 Pink v. United States............................ 642 Plummer, Lee v................................... 658 Pocono Rubber Cloth Co., Livingston, Inc. v....... 637 Pollitt v. Cox................................... 634 Pollitt v. Hall.................................. 641 Pollitt v. Wheat................................. 634 Poole v. Florida................................. 619 Pope v. United States........................ 627, 654 Pratt, Abbott v.................................. 621 Pratt, Jennings v................................ 621 Pratt, Rust v.................................... 621 Pratt, Tigert v.................................. 621 Pratt v. United States........................... 642 President ex rel. Caputo v. Kelly................ 635 Prime Mfg. Co., Boston Machine Works Co. v........660 Quick Action Ignition Co. v. Briggs & Stratton Corp. 661 Quilès, Bonet v.................................. 662 Quill, Williams v................................ 621 Rabinovitz v. Oughton............................ 649 Ragen, Touhy v................................... 657 Railroad Industrial Finance Co., Hill v.......... 634 Railway Employées’ Dept., Nash ville, C. & St. L. Ry. v............................................ 649 Raynor, United States v........................ 665 Red Cab Co., Saint Paul Indemnity Co. v.......... 283 Regents of the University System of Georgia, Allen v. 634 Richmond, Ex parte............................... 657 Roach v. United States....................... 644, 668 TABLE OF CASES REPORTEE. XXI Page. Robert Jacob, Inc. v. Gunnarson.................. 660 Roberts v. Metropolitan Life Ins. Co............. 660 Rowe (F. E.) Sales Co. v. Cleveland Trust Co.. 639, 667 Royal Insurance Co. v. Kentucky Macaroni Co 652 Royal Insurance Co. v. Smith. 656 Rust v. Pratt.................................... 621 Sacramento Municipal Utility District, Pacific Gas & E. Co. v..................................... 640 Saenger, Adam v............................... 59, 666 St. Paul Fire & M. Ins. Co. v. Kaufman Compress Co............................................. 653 Saint Paul Mercury-Indemnity Co., Burke Grain Co. v.......................................... 661 Saint Paul Mercury Indemnity Co. v. Red Cab Co.. 283 Sait Lake County v. Utah Copper Co............. 652 Sanitary Grocery Co., New Negro Alliance v........ 552 Santa Cruz Fruit Packing Co. v. Labor Board.......453 Schauffler, Newport News Shipbuilding Co. v....... 54 School District No. 37, Isackson v................ 636 Schriber-Schroth Co. v. Cleveland Trust Co.... 639, 667 Schultz v. Live Stock National Bank.............. 666 Securities & Exchange Comm’n, Electric Bond Co. v...................................... 419,617 Security-First National Bank v. Welch............ 638 Serven, Spruill v................................ 666 Shaffer, Kansas Farmers Union Co. v..........’... 623 Shannahan v. United States....................... 596 Sharp v. Commissioner............................ 624 Sherman Square Apartments, Brooklyn Trust Co. v. 658 Shinner (E. G.) & Co., Lauf v.................... 323 Shoshone Tribe of Indians, United States v....... 629 Silvershirt Légion of America v. Committee on Edu- cation & Labor................................. 627 Simpson v. Dyer.............................. 642, 669 Smith, Atlantic Refining Co. v.................. 658 Smith, Glenn v................................... 657 XXII TABLE OF CASES REPORTED. Page. Smith, Mooney v................................. 620 Smith, Royal Insurance Co. v.................... 656 Smith v. United States.......................... 652 Smith, Zerbst v................................. 632 Sofranski, Danish v............................. 641 South Carolina Highway Dept. v. Barnwell Bros. 177, 625 Southwestern Bell Téléphoné Co. v. Oklahoma.... 206 Sprague, Ticonic National Bank v................ 406 Spruill v. Ballard.............................. 666 Spruill v. Serven............................... 666 Standard Marine Ins. Co. v. Westchester Fire Ins. Co.............................................. 661 Standard Surety & Casualty Co., Deitrick v....... 471 Stanolind Oil & Gas Co., Logan v................ 636 State Board of Education, Hering v.............. 624 State Farm Mutual Ins. Co. v. Coughran...........485 State Revenue Comm’n, Edgar Bros. Co. v.......... 626 State Tax Comm’n, Atkinson v..................... 20 Stein v. Leibowitt.............................. 652 Sterling v. Commissioner.......................... 663 Stevens v. United States.................... 644, 668 Stewart-Warner Corp., Lincoln Engineering Co. v... 545 Stone, Zerbst v................................. 633 Sullivan, Moulding-Brownell Corp. v............. 638 Sullivan, Zerbst v.............................. 633 Szold v. Ôutlet Embroidery Supply Co............ 623 Taft v. Commissioner............................ 631 Tarrier Co., Phillips v......................... 655 Taylor v. Calmar Steamship Corp.................. 643 Taylor, Calmar Steamship Corp. v................ 525 Terminal Railroad Assn., Brady v................. 10 Terminal Railroad Assn. v. Mrazek............... 656 Texas, United Gas Public Service Co. v....... 123, 625 Therrell, Helvering v........................... 218 Ticonic National Bank v. Sprague................ 406 Tigert v. Pratt................................. 621 Tobias, Adams v............................. 532,620 TABLE OF CASES REPORTED. XXIII Page. Tomlinson v. United States........................ 646 Touhy v. Ragen.................................... 657 Townsend v. United States......................... 664 Trixler, Pickett v................................ 652 Tunnicliffe, Helvering v.......................... 218 T. W. Warner Co., Blair v......................... 664 Union Central Life Ins. Co., Wright v............. 630 Union Marine & General Ins. Co. v. United Fruit Co. 631 Union Stock Yard Co. v. Inghram................... 649 United Fruit Co., Aetna Ins. Co. v................ 631 United Fruit Co., Boston Insurance Co. v.......... 631 United Fruit Co., Union Marine Ins. Co. v.......... 631 United Gas Public Service Co. v. Texas........ 123, 625 United States, Adams v........................ 644, 668 United States v. Baker............................ 642 United States, Bâtes Mfg. Co. v............... 567, 628 United States, Bostic v.......................... 635 United States, Bothwell v......................... 645 United States, Bull v............................ 645 United States, Capone v.......................... 651 United States, Cochrane v........................ 636 United States, Cosman v......................... 617 United States, Dip v............................. 638 United States, Di Santo v....................... 662 United States, Ditsch v....................... 644, 668 United States, Doherty v.......................... 658 United States, Drummond v..................... 644, 668 United States, Dubrin v........................... 646 United States, Escanaba & L. S. R. Co. v........... 315 United States v. Esnault-Pelterie.................. 26 United States, Fellows v.......................... 636 United States, Foster v........................... 118 United States v. Fowler........................... 665 United States v. Griffin.......................... 226 United States, Grunwald v......................... 663 United States v. Hendler.......................... 564 United States, Holman v....................... 644, 668 XXIV TABLE OF CASES REPORTED. Page. United States v. Illinois Central R. Co........... 239 United States, International Sales Co. v......... 651 United States, Jordon v.......................... 654 United States v. Kaplan.......................... 629 United States, Kay v................................ 1 United States v. Klein.......................... 276 United States, Levey v........................... 639 United States, Little v....................... 644, 668 United States, Lonergan v.......................... 33 United States, Lowe Brothers Co. v............ 633 United States, Lubitzky v......................... 663 United States, Luteran v...................... 644, 668 United States, Mackenzie-Kennedy v............ 646 United States, McDonald v......................... 622 United States, Middle States Corp. v.............. 645 United States, Mookini v.......................... 201 United States v. Moor............................. 663 United States, Moran v........................ 643, 669 United States, Munro v............................. 36 United States, Neeper v....................... 644, 668 United States v. O’Donnell........................ 501 United States v. One 1936 Model Ford.............. 633 United States v. Patryas.......................... 341 United States, Phillips v......................... 649 United States, Pink v............................. 642 United States, Pope v......................... 627, 654 United States, Pratt v.......................... 642 United States v. Raynor.......................... 665 United States, Roach v...................... 644, 668 United States, Shannahan v....................... 596 United States v. Shoshone Tribe................ 629 United States, Smith v........................... 652 United States, Stevens v...................... 644, 668 United States, Tomlinson v...................... 646 United States, Townsend v...................... 664 United States, Valli v.............. J........... 632 United States, Van Riper v........................ 635 TABLE OF CASES REPORTED. XXV Page. United States, Walker v.................... 644,668 United States, Weinstein v..................... 646 United States, Wells v..................... 644, 668 United States v. Wharton Green & Co............ 661 United States, Wilkinson v..................... 643 United States, Wolk v.......................... 658 United States v. Wurts......................... 414 United States, Yvette Co. v...................... 657 U. S. ex rel. Pannone v. Martineau............. 643 U. S. ex rel. Willoughby v. Howard............. 666 Utah Copper Co., Sait Lake County v............ 652 Valentine, Indiana ex rel., v. Marker.......... 628 Valiente & Co., Bonet v......................... 662 Valli v. United States......................... 632 Van Riper v. United States..................... 635 Virginia, Guaranty Trust Co. v................. 632 Wabash Appliance Corp. v. General Electric Co. 641, 667 Waldorf System, M. McDonough Co. v............. 663 Walker, Palka v................................ 628 Walker v. United States.................... 644, 668 Warner (T. W.) Co., Blair v.................... 664 Washington, Lindsey v...................... 654,669 Washington v. McGrath.......................... 651 Weinstein v. United States..................... 646 Welch, Hassett v............................... 303 Welch, Security-First National Bank v.......... 638 Wells v. United States..................... 644, 668 Westchester Fire Ins. Co., Standard Ins. Co. v.. 661 West (M. G.) Co., Johnson v.................... 666 Western Live Stock v. Bureau of Revenue......... 250 Western Union Telegraph Co., Dowling v.......... 650 West Publishing Co., McGoldrick v.............. 656 Wharton Green & Co., United States v........... 661 Wheat, Pollitt v............................... 634 W. H. Miner, Inc., Peerless Equipment Co. v..... 641 Wilkinson v. United States..................... 643 Willcox v. Goess............................... 647 XXVI TABLE OF CASES REPORTED. Page. Williams v. Corden Corp.......................... 659 Williams v. Quill............................... 621 Willoughby, U. S. ex rel., v. Howard............. 666 Wilson, Helvering v.............................. 630 Winmill, Helvering v............................. 633 Winona, Allbritton v............................. 627 Wise, Chandler v................................. 634 Wolk v. United States............................ 658 Wright v. Union Central Life Ins. Co..............630 Wurts, United States v........................... 414 Wyman v. Newhouse................................ 664 Young, Ex parte.................................. 619 Yvette Company v. United States.................. 647 Zerbst v. Collins................................ 632 Zerbst, Johnson v................................ 629 Zerbst v. Jones.................................. 633 Zerbst, Keller v................................. 637 Zerbst v. Kidwell................................ 632 Zerbst, Lupo v................................... 646 Zerbst, Murphy v................................. 650 Zerbst v. Owens.................................. 633 Zerbst v. Peel................................... 633 Zerbst v. Smith.................................. 632 Zerbst v. Stone.................................. 633 Zerbst v. Sullivan............................... 633 TABLE OF CASES CitedL in Opinions Page Abbott Machine Co. v. Bonn, 51 F. 223 550 Abie State Bank v. Bryan, 282 U. S. 765 99 Acker v. Hamilton, 85 F. 2d 574 541 Adams Express Co. v. Kentucky, 166 U. S. 171 255 Adams Express Co. v. Ohio State Auditor, 165 U. S. 194 255 Aero Mayflower Transit Co. v. Georgia Public Service Comm’n, 295 U. S. 285 84, 587 Aetna Life Ins. Co. v. Dun-ken, 266 U. S. 389 143 Air Way Appliance Corp. v. Day, 266 U. S. 71 587 Alabama v. United States, 279 U. S. 229 52 Alaska Fish Co. v. Smith, 255 U. S. 44 84, 587 Aldrich v. Chemical National Bank, 176 U. S. 618 412 Alemite Corp. v. Lubrair Corp., 62 F. 2d 898 550 Alward v. Johnson, 282 U. S. 509 385 Alzua v. Johnson, 231 U. S. 106 358, 359 American Bank v. Goss, 236 N. Y. 488 . 314 American Bridge Co. v. Hunt, 130 F. 302 288 American Furniture Co. v. Chauffeurs Union, 222 Wis. 338 328, 338, 340 American Iron & Steel Mfg. Co. v. Seaboard Air Line Ry., 233 U. S. 261 411-413 Page American Mfg. Co. v. St. Louis, 250 U. S. 459 257, 258,261,583,610 American Ry. Express Co. v. Levee, 263 U. S. 19 61 American Sheet & Tin Plate Co. v. Winzeler, 227 F. 321 288 American Steel Foundries v. Tri-City Council, 257 U. S. 184 562 American Stores Co. v. Ger-lach, 55 F. 2d 658 293 American Tel. & Tel. Co. v. United States, 299 U. S. 232 150, 437, 439 Ancient Egyptian Order v. Michaux, 279 U. S. 737 64 Anderson v. Pacific Coast S. S. Co., 225 U. S. 187 188 Angeny v. Keuper, 16 F. Supp. 542 541 Anne, The, 3 Wheat. 435 74 Anniston Mfg. Co. v. Davis, 301 U. S. 337 50, 51, 443 Applebv v. City of New York, 271 U. S. 364 593 Arburn v. Hunt, 207 Ind. 61 104, 107 Arguello v. United States, 18 How. 539 521 Arizona, The v. Anelich, 298 U. S. 110 529 Armstrong v. American Exchange Nat. Bank, 133 U. S. 433 411 Armstrong v. Treasurer of Athens County, 16 Pet. 281 110 Armstrong v. Walters, 219 F. 320 289 XXVII XXVIII TABLE OF CASES CITED. Page. Asbell v. Kansas, 209 U. S. 251 188 Ashwander v. Tennessee Valley Authority, 297 U. S. 288 443 Atchison, T. & S. F. R. Co. v. Matthews, 174 U. S. 96 578 Atchison, T. & S. F. Ry. v. United States, 225 U. S. 640 229 Atchison, T. & S. F. Ry. Co. v. United States, 279 U. S. 768 599 Atchison, T. & S. F. Ry. Co. v. United States, 178 F. 12 403 Atlantic Coast Line R. Co. v. Daughton, 262 U. S. 413 579 Atlantic Coast Line v. Ford, 287 U. S. 502 170 Atlantic Coast Line R. Co. v. Wharton, 207 U. S. 328 186 Atlantic & Pacific Tea Co. v. Grosjean, 301 U. S. 412 85, 582 Atlantic Trust Co. v. Chapman, 208 U. S. 360 361 Atlantic Trust Co. v. Dana, 128 F. 209 482 Attualita, The, 238 F. 909 71, 75 Bacon v. Illinois, 227 U. S. 504 466 Bacon v. Texas, 163 U. S. 207 61 Bain Peanut Co. v. Pinson, 282 U. S. 499 61 Baldwin v. G. A. F. Seelig, Inc., 294 U. S. 511 185, 186, 256 Bail & Socket Fastener Co. v. Kraetzer, 150 U. S. 111 550 Ballard v. Hunter, 204 U. S. 241 622 Baltimore & Ohio R. Co. v. Hooven, 297 F. 919 13 Baltimore & Ohio R. Co. v. United States, 293 U. S. 454 235 Bane v. Keefer, 66 F. 610 295 Bankline Oil Co. v. Commissioner, 90 F. 2d 899 378 Page. Bank of America Assn. v. Cuccia, 93 F. 2d 754 352, 362 Bank of Arapahoe v. David Bradley & Co., 72 F. 867 289 Bank of Augusta v. Earle, 13 Pet. 519 83 Bank of Commerce v. Tennessee, 163 U. S. 416 99 Barbier v. Connolly, 113 U. S. 27 111 Barbour v. Thomas, 86 F. 2d 510 541 Barnet v. National Bank, 98 U. S. 555 247 Barron v. Baltimore, 7 Pet. 243 151 Barrow, In re, 98 F. 582 360 Barry v. Edmunds, 116 U. S. 550 288, 289 Bartlett v. Kane, 16 How. 263 401 Bassick Mfg. Co. v. Hol-lingshead Co., 298 U. S. 415 546 Bass, Ratcliff & Gretton v. State Tax Comm’n, 266 U. S. 271 255 Beard v. Federy, 3 Wall. 478 511, 513, 514, 519 Beddings v. Great Eastern Stages, Inc., 6 F. Supp. 529 292 Bedford Cut Stone Co. v. Journeymen Stone Cutters’ Assn., 274 U. S. 37 465 Bellingham Bay & B. C. R. Co. v. New Whatcom, 172 U. S. 314 622 Bell’s Gap R. Co. v. Pennsylvania, 134 U. S. 232 .578 Benson Mining & S. Co. v. Alta Mining & S. Co., 145 U. S. 428 514 Berizzi Bros. Co. v. The Pe-saro, 271 U. S. 562 74r-76 Berlin v. Commissioner, 59 F. 2d 996 403 Bernheim v. Louisville Prop-erty Co., 221 F. 273 292 Berreyesa v. United States, 154 U. S. 623 507 TABLE OF CASES CITED. XXIX Page. Bethlehem Shipbuilding Corp. v. Myers, 89 F. 2d 1000 57 Bischoff v. Wethered, 9 Wall. 812 31 Blair v. Commissioner, 300 U. S. 5 625 Bliss, In re, 39 App. D. C. 453 550 Bloodworth-Stembridge Co., In re, 178 F. 372 358 Bluefield Water Works Co. v. Public Service Comm’n, 262 U. S. 679 50, 139 Board v. Commissioner, 51 F. 2d 73 403 Board of Trade v. Wallace, 67 F. 2d 402 400 Borden’s Co. v. Baldwin, 293 U. S. 194 578 Borden’s Farm Products Co. v. Ten Eyck, 297 U. S. 251; 11 F. Supp. 599 192 Borer v. Chapman, 119 U. S. 587 418 Boseman v. Connecticut General Life Ins. Co., 301 U. S. 196 81 Bostwick v. Brinkerhoff, 106 U. S. 3 622 Botany Mills v. United States, 278 U. S. 282 31 Bothwell v. Commissioner, 77 F. 2d 35 403 Bouker No. 2, The, 241 F. 831 528-531 Bowen v. James Vernor Co., 89 F. 2d 968 44 Bowman v. Chicago & N. W. R. Co., 125 U. S. 465 185 Boyd v. United States, 116 U. S. 616 400, 402, 404 Boynton v. Hall, 121 U. S. 457 249 Bradley v. Fisher, 13 Wall. 335 358 Bradley v. Public Utilities Comm’n, 289 U. S. 92 189 Bradley Lumber Co. v. National Labor Board, 84 F. 2d 97 44, 51 Brady v. Wabash Ry. Co., 329 Mo. 1123 12 Page. Brannan v. Harrison, 284 U. S. 579 621 Breedlove v. Suttles, 302 U. S. 277 578 Brewster v. Gage, 280 U. S. 327 312 Brimmer v. Rebman, 138 U. S. 78 188 Brinkerhoff v. Aloe, 146 U. S. 515 549 Bronson v. La Crosse R. Co., 1 Wall. 405 361 Brooklyn Bus Corp. v. City of New York, 274 N. Y. 140 592 Brooks v. United States, 267 U. S. 432 442 Brothers v. United States, 250 U. S. 88 29 Brown v. Hitchcock, 173 U. S. 473 514 Brown v. Maryland, 12 Wheat. 419 186 Brown v. Mississippi, 297 U. S. 278 621 Brown v. Pennsylvania Canal Co., 229 F. 444 277 Brown v. Pennsylvania R. Co., 250 F. 513 277 Brown v. The Bradish Johnson, Fed. Cas. No. 1992 527 Brown-Forman Co. v. Kentucky, 217 U. S. 563 579 Browning v. Waycross, 233 U. S. 16 253 Bruce v. Tobin, 245 U. S. 18 626 Bruner (Owen M.) Co. v. O. R. Manefee Lumber Co., 292 F. 985 288 Brush v. Commissioner, 300 U. S. 352 222 Buck v. Colbath, 3 Wall. 834 281 Bugajewitz v. Adams, 228 U. S. 585 399 Bull v. United States, 295 U. S. 247 496 Burnet v. Coronado Oil & Gas Co., 285 U. S. 393 85, 369, 383, 384, 387, 389, 390 Burnet v. Harmel, 287 U. S. 103 375 XXX TABLE OF CASES CITED. Page. Burnet v. Jergins Trust, 288 U. S. 508 222, 224, 369, 383, 386 Burnet v. Northern Trust Co., 283 U. S. 782 309, 311 Burnet v. Sanford & Brooks Co., 282 U. S. 359 495, 498 Burt v. Evory, 133 U. S. 349 549 Burton v. United States, 196 U. S. 283 111 Burton v. United States, 202 U. S. 344 398 Bushnell v. Leland, 164 U. S. 684 540 Butler v. Pennsylvania, 10 How. 402 116 Byers v. McAuley, 149 U. S. 608 281 Cabot v. McMaster, 61 F. 129 289 Caldwell v. North Carolina, 187 U. S. 622 186 California National Bank v. Stateler, 171 U. S. 447 626 Calumet Foundry & M. Co. v. Mroz, 79 Ind. App. 305 314 Campbell, In re, 64 Cal. App. 300 452 Card, J. F., The, 43 F. 92 530, 531 Cardwell v. American River Bridge Co., 113 U. S. 205 188 Carlisle Lumber Co. v. Hope, 83 F. 2d 92 44 Carlo Poma, The, 259 F. 369; 255 U. S. 219 75 Carmichael v. Southern Coal & Coke Co., 301 U. S. 495 578, 581, 585, 627 Carpenter v. People’s Mutual Life Ins. Co., 94 Cal. Dec. 674 79 Carpenter v. Shaw, 280 U. S. 363 389 Carter v. Carter Coal Co., 298 U. S. 238 466, 469, 470 Carter v. Texas, 177 U. S. 442 450,616 Case v. Terrell, 11 Wall. 199 482 Case of State Freight Tax, 15 Wall. 232 256 Page. Casey v. Galli, 94 U. S. 673 540 Cassidy v. Atlanta & C. A. L. Ry. Co., 109 F. 673 295 Cassius, The, 2 Dali. 365 74 Castillo v. McConnico, 168 U. S. 674 142 Castle v. United States, 17 F. Supp. 515 404 Cedar Rapids Gas Co. v. Ce-dar Rapids, 223 U. S. 655 160 Central Union Co. v. Ed-wardsville, 269 U. S. 190 139 Central Union Tel. Co. v. Indianapolis Tel. Co., 189 Ind. 210 109 Central Vermont Ry. Co. v. White, 238 U. S. 507 175 Chaffee & Co. v. United States, 18 Wall. 516 247 Chamber of Commerce v. Fédéral Trade Comm’n, 52 App. D. C. 40 52 Champion v. Ames, 188 U. S. 321 442 Champlin Refining Co. v. Corporation Comm’n, 286 U. S. 210 434 Chantangco v. Abaroa, 218 U. S. 476 397 Charles River Bridge v. Warren Bridge, 11 Pet. 420 114 Charlestown School Twp. v. Hay, 74 Ind. 127 101 Chase v. Curtis, 113 U. S. 452 249 Chassaniol v. Greenwood, 291 U. S. 584 259, 610 Chelentis v. Luckenbach S. S. Co., 247 U. S. 372 527 Chemical National Bank v. Armstrong, 59 F. 384 411, 412, 414 Chesapeake & O. Ry. Co. v. McDonald, 214 U. S. 191 623 Chesbrough v. Northern Trust Co., 252 U. S. 83 291 Chesbrough v. Woodworth, 251 F. 881 291 Chicago v. Schultz, 341 111. 208 452 TABLE OF CASES CITED. XXXI Page. Chicago Board of Trade v. Olsen, 262 U. S. 1 464 Chicago, B. & Q. R. Co. v. Chicago, 166 U. S. 226 152 Chicago, B. & Q. R. Co. v. Railroad Comm’n, 237 U. S. 220 186 Chicago, B. & Q. Ry. Co. v. United States, 220 U. S. 559 15, 400, 403 Chicago, B. & Q. R. Co. v. United States, 194 F. 342 243 Chicago & Eastern Illinois Ry. v. United States, 63 Ct. Cls. 585 238 Chicago & Eastern Illinois Ry. Co. v. United States, 72 Ct. Cls. 407 238 Chicago Great Western R. Co. v. Schendel, 267 U. S. 287 13 Chicago & G. T. Ry. Co. v. Wellman, 143 U. S. 339 147, 150 Chicago Life Ins. Co. v. Cherry, 244 U. S. 25 62 Chicago, M., St. P. & P. R. Co. v. Risty, 276 U. S. 567 51 Chicago & N. W. Ry. Co. v. Bolle, 284 U. S. 74 468 Chicago & N. W. Ry. Co. v. Lindell, 281 U. S. 14 68 Chicago & N. W. Ry. Co. v. United States, 246 U. S. 512 242 Chicago, R. I. & P. R. Co. v. Arkansas, 219 U. S. 453 186 Chicago Tunnel Co. v. Igoe, N. D. 111. 603 Chicago Warehouse & Terminal Co. v. Igoe, N. D. 111. 603 Chick v. New England Tel. & Tel. Co., 36 F. 2d 832 289 Choctaw, O. & G. R. Co. v. Harrison, 235 U. S. 292 384, 388, 389, 390 Choteau v. Burnet, 283 U. S. 691 389 Church v. Hubbard, 91 F. 2d 406 541 Page. Cincinnati Soap Co. v. United States, 301 U. S. 308 586, 587 Cinderella Theatre Co. v. Sign Writers’ Local, 6 F. Supp. 164 563 City Bank Co. v. Schnader, 291 U. S. 24 19 City Bank Farmers Trust Co. v. Schnader, 291 U. S. 24 52 City National Bank v. Ful-ler, 52 F. 2d 870 538 City of Alexandria, The, 17 F. 390 527 City of Crawfordsville v. Hays, 42 Ind. 200 101 City of Panama, 101 U. S. 453 205 Clark v. Lindemann & Hov-erson Co., 88 F. 2d 59 44, 52 Clark v. Poor, 274 U. S. 554 189 Clark v. Titusville, 184 U. S. 329 583 Clarke v. Mathewson, 12 Pet. 164 294 Clarke v. McDade, 165 U. S. 168 623 Clay v. Swope, 38 F. 396 403 Clement v. Phoenix Ins. Co., Fed. Cas. No. 2,882 217 Cleveland, C., C. & St. L. Ry. Co. v. Backus, 154 U. S. 439 255 Cleveland C. C. & St. L. R. Co. v. lüinois, 177 U. S. 514 186 Cliquot’s Champagne, 3 Wall. 114 401, 403 Clyde Mallory Lines v. Ala-bama ex rel. State Docks Comm’n, 296 U. S. 261 188 Coale v. Pearson, 290 U. S. 597 624 Coder v. Arts, 213 U. S. 223; 152 F. 943 413 Cody v. United States, 73 F. 2d 180 34 Coffey v. United States, 116 U. S. 436 396, 405, 406 XXXII TABLE OF CASES CITED. Page. Coffin v. Philadelphia, W. & B. R. Co., 118 F. 688 292 Cohn v. Cities Service Co., 45 F. 2d 687 290 Coleman v. City of Griffin, 302 U. S. 636; 55 Ga. App. 123 449, 450 Colgate v. Harvey, 295 U. S. 404 586 Collecter v. Day, 11 Wall. 113 390 Collier v. United States, 173 U. S. 79 29 Colombia v. Cauca Co., 190 U. S. 524 74 Columbia Water Power Co. v. Columbia Electric St. Ry. Co., 172 U. S. 475 99 Columbus & G. Ry. Co. v. Miller, 283 U. S. 96 • 579 Commissioner v. Fleming, 82 F. 2d 324 374 Commonwealth Trust Co. v. Bradford, 297 U. S. 613 281 Compania General De Ta-bacos v. Collector, 275 U. S. 87 81, 82 Connally v. General Construction Co., 269 U. S. 385 9 Connecticut General Life Ins. Co. v. Johnson, 303 U. S. 83 147 Connecticut General Life Ins. Co. v. Johnson, 3 Cal. 2d 83; 296 U. S. 535 79, 81 Consolidated Tile Securities Co. v. Hopkins, 1 Cal. 2d 414 79 Constitution, The, L. R. 4 P. D. 39 74 Continental Illinois Nat. Bank & T. Co. v. Chicago, R. I. & P. Ry. Co., 294 U. S. 648 354, 356 Continental National Bank v. National City Bank, 69 F. 2d 312 214, 217 Cook v. Pennsylvania, 97 U. S. 566 186 Page. Cooke v. United States, 2 Wall. 218 293 Cooley v. Board of Port Wardens, 12 How. 299 185, 186, 188 Cooney v. Mountain States Tel. Co., 294 U. S. 384 609, 611 Cornélius v. Kessel, 128 U. S. 456 514 Coronado Coal Co. v. United Mine Workers, 268 U. S. 295 465 Cortès v. Baltimore Insular Line, 287 U. S. 367 527-529 Cotton v. Hawaii, 211 U. S. 162 622 Coughlin v. Sullivan, 100 N. J. L. 42 452 Coupe v. Royer, 155 U. S. 565 31, 140 Cox v. Colorado, 282 U. S. 807 621 Cresswell v. Tillinghast, 286 U. S. 560 626 Creswill v. Knights of Py-thias, 225 U. S. 246 64 Crew Levick Co. v. Pennsylvania, 245 U. S. 292 255, 261, 610 Crocker v. United States, 240 U. S. 74 29 Crohn v. Téléphoné Co., 131 Mo. App. 313 314 Crowell v. Benson, 285 U. S. 22 50 Crozier v. Krupp, 224 U. S. 290 28 Cudahy Packing Co. v. Minnesota, 246 U. S. 450 255- 257, 610 Cummings v. Chicago, 188 U. S. 410 188 Cusack (Thomas) Co. v. Chicago, 242 U. S. 526 191 Cuyahoga River Power Co. v. Akron, 240 U. S. 462 450 Dalton Adding Machine Co. v. State Corporation Comm’n, 236 U. S. 699 51,52 TABLE OF CASES CITED. XXXIII Page. Darby-Lynde Co. v. Alexander, 51 F. 2d 56 376 Darcy v. Commissioner, 66 F. 2d 581 496 Daube v. United States, 289 U. S. 367 418 Daugherty v. Thompson- Lockhart Co., 211 F. 224 528 Davidson v. New Orléans, 96 U. S. 97 153 Davis, In re, 155 F. 671 361 Davis, The, 10 Wall. 15 75 Davis v. Beason, 133 U. S. 333 449 Davis v. Wechsler, 263 U. S. 22 64 Davis v. Wolfe, 263 U. S. 239 15 Davis Trust Co. v. Hardee, 85 F. 2d 571 541,542 Dayton Power & L. Co. v. Public Utilities Comm’n, 292 U. S. 290 144, 150 Dearbom Publishing Co. v. Fitzgerald, 271 F. 479 452 Deering v. Winona Har-vester Works, 155 U. S. 286 550 De Jonge v. Oregon, 299 U. S. 353 450,452 Delaware & Hudson Co. v. United States, 266 U. S. 438 234,235 Delk v. St. Louis & S. F. R. Co., 220 U. S. 580 13 Del Vecchio v. Bowers, 296 U. S. 280 170 Dent v. West Virginia, 129 U. S. 114 623 Denver v. New York Trust Co., 229 U. S. 123 53 Denver City Tramway Co. v. Norton, 141 F. 599 289 De Saussure v. Gaillard, 127 U. S. 216 213 Despiau v. U. S. Casualty Co., 89 F. 2d 43 171 De Stafano v. Almond Co., 107 N. J. Eq. 156 482 Deweese v. Smith, 106 F. 438 541 Page. Dobbins v. Commissioners, 16 Pet. 435 222 Dodge v. Board of Education, 302 U. S. 74 107,114,622 Doll v. Evans, Fed. Cas. No. 3969 401,403 D o n o v an v. Dixieland Amusement Co., 152 F. 661 292 Dorsheimer v. United States, 7 Wall. 166 401 Douglas v. Noble, 261 U. S. 165 623 Douglas v. Willcuts, 296 U. S. 1 566 Douglass v. Thurston County, 86 F. 2d 899 410 Downing v. Indiana State Board, 129 Ind. 443 109 Doyle v. Atwell, 261 U. S. 590 621 Doyle v. Mitchell Bros. Co., 247 U. S. 179 121 Dreisbach v. National Bank, 104 U. S. 52 247 Ducat v. Chicago, 10 Wall. 410 83 Duke v. Stayton Co., 132 Wash. 69 482 Dunn v. Clarke, 8 Pet. 1 294 Dunn v. O’Connor, 89 F. 2d 820 542 Duplex Printing Press Co. v. Deering, 254 U. S. 443 562 Easton v. lowa, 188 U. S. 220 483 Edelman v. Boeing Air Transport, 298 U. S. 249 612 Edwards v. Elliott, 21 Wall. 532 151 Egner v. United States, 16 F. 2d 597 404 E. I. Dupont de Nemours & Co. v. Boland, 85 F. 2d 12 44,49 Eisner v. Macomber, 252 U. S. 189 122 Elting v. North German Lloyd, 287 U. S. 324 402 Elwood v. State, 203 Ind. 626 112 53383°—38---m XXXIV TABLE OF CASES CITED Page. Emery (B. V.) & Co. v. Wilkinson, 72 F. 2d 10 538, 541 Employais Corp. v. Bryant, 299 U. S. 374 638 Engel v. O’Malley, 219 U. S. 128 253 Equitable Life Assurance Society v. Pennsylvania, 238 U. S. 143 82 Erie Ry. Co. v. Pennsylvania, 21 Wall. 492 590,594 Escanaba Co. v. Chicago, 107 U. S. 678 185,188 Euclid v. Ambler Realty Co., 272 U. S. 365 191,627 Exchange, The, 7 Cranch 116 74 Exeter National Bank v. Or-chard, 43 Neb. 579 249 Ex parte. See name of party. Fairport R. Co. v. Mere-dith, 292 U. S. 589 14 Fargo v. Michigan, 121 U. S. 230 255-257 Farmers’ Livestock Comm’n Co. v. United States, 54 F. 2d 375 400 Farmers & Mechanics Bank v. Minnesota, 232 U. S. 516 388, 390 Farmers’ & Mechanics’ National Bank v. Dearing, 91 U. S. 29 247, 248 Farncomb v. Denver, 252 U. S. 7 51 Farrar v. Steensburg, 173 Cal. 94 65-67 Fash v. First National Bank, 89 F. 2d 110 410 Fasulo v. United States, 272 U. S. 620 248 Fédéral Compress Co. v. McLean, 291 U. S. 17 258, 259, 610 Fédéral Trade Comm’n v. Claire Furnace Co., 274 U. S. 160 49, 51 Fédéral Trade Comm’n v. Raladam Co., 283 U. S. 64.3 468 Page. Ficklen v. Shelby County Taxing Dist., 145 U. S. 1 254, 256, 258, 610 Fidelity & Casualty Co. v. Driver, 79 F. 2d 701 171, 172 Fifth Avenue Coach Co. v. . New York, 221 U. S. 467 84 Finn v. Railroad Comm’n, 286 U. S. 559 626 Finn v. United States, 123 U. S. 227 41 First National Bank v. Anderson, 269 U. S. 341 450 First National Bank v. Board of County Com-m’rs, 264 U. S. 450 51 First National Bank v. Bon-ner, 74 F. 2d 139 358, 360 First National Bank v. Las-ater, 196 U. S. 115 247 First National Bank v. Louisiana Highway Comm’n, 264 U. S. 308 289 Fisher’s Blend Station v. State Tax Comm’n, 297 U. S. 650 255, 260, 609 Flanders v. Town of Merri-mack, 48 Wis. 567 314 Fleischmann Construction Co. v. United States, 270 U. S. 349 334 Fong Yue Ting v. United States, 149 U. S. 698 399 Forte v. United States, 302 U. S. 220 9 Foster-Fountain Packing Co. v. Haydel, 278 U. S. 1 185, 188 Four Packages v. United States, 97 U. S. 404 403 Fox v. Standard Oil Co., 294 U. S. 87 84, 582 Fox Film Corp. v. Muller, 296 U. S. 207 99 Frad v. Kelly, 302 U. S. 312 618 Frank v. Mangum, 237 U. S. 309 141 Frankel v. New York Life Ins. Co., 51 F. 2d 933 172 Freedman v. Commissioner, 92 F. 2d 150 222 TABLE OF CASES CITED. XXXV Page. Fremont v. United States, 17 How. 542 520, 521 Freuler v. Helvering, 291 U. S. 35 625 Fruehauf Trader Co. v. Highway Trader Co., 54 F. 2d 691 550 Funkhouser v. Preston Co., 290 U. S. 163 593 Gai veston, H. & S. A. Ry. Co. v. Texas, 210 U. S. 217 254-256, 259 Gates Iron-Works v. Fraser, 153 U. S. 332; 42 F. 49 550 Geer v. Connecticut, 161 U. S. 519 185, 188 General Baking Co. v. Harr, 300 U. S. 433 281 General Construction Co. v. Fisher, 295 U. S. 715 21 General Electric Co. v. Ohio Brass Co., 277 F. 917 550 General Interest Ins. Co. v. Ruggles, 12 Wheat. 408 345 General Investment Co. v. Lake Shore & M. S. Ry. Co., 260 U. S. 261 271 General Ry. Signal Co. v. Virginia, 246 U. S. 500 254 Georgia Ry. Co. v. Decatur, 262 U. S. 432 622 German Alliance Ins. Co. v. Lewis, 233 U. S. 389 578 Germantown Trust Co., In re, 57 F. 2d 365 550 Gibbons v. Ogden, 9 Wheat. 1 186 Gilbert v. David, 235 U. S. 561 288 Gill v. Everman, 94 Tex. 209 63 Gillespie v. Oklahoma, 257 U. S. 501 383, 384, 387, 389, 390 Gilman v. Philadelphia, 3 Wall. 713 185, 188 Giozza v. Tiernan, 148 U. S. 657 578 Gitlow v. New York, 268 U. S. 652 450 Gladson v. Minnesota, 166 U. S. 427 186 Gloucester Ferry Co. v. Pennsylvania, 114 U. S. 196 185 Golden v. United States, 34 F. 2d 367 346 Goldstein v. United States, 73 F. 2d 804 34 Gooch v. United States, 297 U. S. 124 442 Gordon v. Longest, 16 Pet. 97 291 Gorham Mfg. Co. v. State Tax Comm’n, 266 U. S. 265 51 Gould v. Gould, 245 U. S. 151 314 Grain Distdlery No. 8 v. United States, 204 F. 429 403 Grand Trunk Western Ry. Co. v. United States, 252 U. S. 112 416 Grant Bros. Construction Co. v. United States, 232 U. S. 647 400, 403, 404 Grayson v. Harris, 267 U. S. 352 98 Great Atlantic & Pac. Tea Co. v. Grosjean, 301 U. S. 412 85, 582 Great Northern R. Co. v. Otos, 239 U. S. 349 13, 15 Great Northern Ry. Co. v. United States, 277 U. S. 172 235, 237, 601 Green v. Frazier, 253 U. S. 233 627 Greene County Bank v. Teasdale Comm’n Co., 112 F. 801 288 Gregg Dyeing Co. v. Query, 286 U. S. 472 612 Gregg School Twp. v. Hin-shaw, 76 Ind. App. 503 101 Grether v. Wright, 75 F. 742 388 Grisar v. McDowell, 6 Wall. 363 511,515,524 Grosjean v. American Press Co., 297 Ù. S. 233 450,452 Group No. 1 Oil Corp. v. Bass, 283 U. S. 279 386,389 XXXVI TABLE OF CASES CITED. Page. Gulf, C. & S. F. Ry. Co. v. Ellis, 165 U. S. 150 88 Gulf, C. & S. F. R. Co. v. Texas, 246 U. S. 58 186 Gustafson v. Hammond Irri- gation Dist., 87 Mont. 217 314 Gwinn v. Commissioner, 287 U. S. 224 618 Hadacheck v. Sébastian, 239 U. S. 394 191 Haie v. State Board, 302 U. S. 95 591,593 Hall v. DeCuir, 95 U. S. 485 185 Hallock v. Commercial Ins. Co., 26 N. J. L. 268 345 Hamburg-American Line v. United States, 291 U. S. 420 402 Hamilton v. Brown, 161 U. S. 256 282 Hamilton v. Regents, 293 U. S. 245 624 Hampton Stave Co. v. Gard-ner, 154 F. 805 289 Hanby v. Commissioner, 67 F. 2d 125 398, 404 Hanley v. Donoghue, 116 U. S. 1 62, 63 Hanover Fire Ins. Co. v. Harding, 272 U. S. 494 80,83 Hansen & Birch, In re, 292 F. 898 361 Haracovic v. Standard Oil Co., 105 F. 785 295 Harden v. Gordon, Fed. Cas. No. 6047 528, 529 Hardenbergh v. Ray, 151 U. S. 112 295 Harley v. Firemen’s Fund Ins. Co., 245 F. 471 294 Harris v. Schlinke, 95 Tex. 88 65 Harrison School Twp. v. Mc- Gregor, 96 Ind. 185 101 Hartford Accident & I. Co. v . Delta & Pine Land Co., 292 U. S. 143 81 Haseltine v. Central Bank (No. 1), 183 U. S. 130 626 Haseltine v. Central Bank, 183 U. S. 132 247 Page. Hassett v. Welch, 303 U. S. 303 302 Hawker v. New York, 170 U. S. 189 400 Hayward v. Nordberg Mfg. Co., 85 F. 4 291, 292 Heald v. Rice, 104 U. S. 737 30, 550 Healy v. Ratta, 292 U. S. 263 19 Hebert v. Louisiana, 272 U. S. 312 619 Hegeman Farms Corp. v. Baldwin, 293 U. S. 163 51 Heidritter v. Elizabeth Oil- Cloth Co., 112 U. S. 294 281 Heiner v. Colonial Trust Co., 275 U. S. 232 389, 500 Heiner v. Donnan, 285 U. S. 312 170 Heisler v. Thomas Colliery Co., 260 U. S. 245 578 Heller Bros. Co. v. Lind, 66 App. D. C. 306; 86 F. 2d 862 44,52 Hellmich v. Hellman, 276 U. S. 233 121 Helson v. Kentucky, 279 U. S. 245 611, 612 Helvering v. Bankline Oil Co., 303 U. S. 362 371, 372, 376, 378, 386 Helvering v. Bullard, 303 U. S. 297 307 Helvering v. Canfield, 291 U. S. 163 120, 122 Helvering v. City Bank Farmers T. Co., 296 U. S. 85 302 Helvering v. Gowran, 302 U. S. 238 500 Helvering v. Mitchell, 303 U. S. 391 442 Helvering v. Mountain Pro-ducers Corp., 303 U. S. 376 370 Helvering v. O’Donnell, 303 U. S. 370 375,376 Helvering v. Powers, 293 U. S. 214 222, 224 Helvering v. Rankin, 295 U. S. 123 31 TABLE OF CASES CITED. XXXVII Page. Helvering Stockholms En-skilda Bank, 293 U. S. 84 500 Helvering v. Tex-Penn Co., 300 U. S. 481 31 Helvering v. Therrell, 303 U. S.218 386 Helvering v. Twin Bell Syndicale, 293 U. S. 312 367, 371, 372, 376, 381, 382 Henderson Bridge Co. v. Henderson, 173 U. S. 592 98 Henderson Bridge Co. v. Kentucky, 166 U. S. 150 257 Hendrick v. Maryland, 235 U. S. 610 189 Henneford v. Silas Mason Co., 300 U. S. 577 18,612 Hennington v. Georgia, 163 U. S. 299 186 Henry B. Fiske, The, 141 F. 188 528 Henry School Twp. v. Mere-dith, 32 Ind. App. 607 101 Hepner v. United States, 213 U. S. 103 400,403 Hemdon v. Chicago, R. I. & P. R. Co., 218 U. S. 135 186 Heydenfeldt v. Daney Gold & S. M. Co., 93 U. S. 634 334 Hiawassee Power Co. v. Car-olina-Tenn. Co., 252 U. S. 341 623 Highland Farms Dairy v. Agnew, 300 U. S. 608 623 Hitchman Coal & Coke Co. v. Mitchell, 245 U. S. 229 52 Holden v. Utah & M. M. Co., 82 F. 209 289 Holt v. Cummings, 102 Pa. 212 531 Holy Trinity Church v. United States, 143 U. S. 457 334 Home Benefit Assn. v. Sar-gent, 142 U. S. 691 171 Home Bldg. & Loan Assn. v. Blaisdell, 290 U. S. 398 109, 356 Home Ins. Co. v. Dick, 281 U. S. 397 81 Page. Home Savings Bank v. Des Moines, 205 U. S. 5,03 388 Home Tel.'& Tel. Co. v. Los Angeles, 227 U. S. 278 450 Hood v. Bell, 84 F. 2d 136 290 Hooker v. Knapp, 225 U. S. 302 234,599 Hooper v. California, 155 U. S. 648 253 Hooper v. Robinson, 98 U. S. 528 345 Hope Naturel Gas Co. v. Hall, 274 U. S. 284 258, 611 Hom Silver Mining Co. v. New York, 143 U. S. 305 83 Horst v. Merkley, 59 F. 502 289 Howard v. Gipsy Oil Co., 247 U. S. 503 389, 390 Hudson & Manhattan Ry. v. Hardy, 22 F. Supp. 105 603 Hudson & Manhattan Ry. v. Quinn, D. N. J. 603 Hudson Water Co. v. Mc- Carter, 209 U. S. 349 627 Hughes & Co. v. Peper Tobacco Warehouse Co., 126 F. 687 292 Humber Ironworks & Ship-building Co., In re, IV Ch. App. Cas. 643 411, 413 Humber Ironworks & Ship-building Co., In re, V Ch. App. Cas. 88 413 Humphrey’s Executor v. United States, 295 U. S. 602 111 Huntington v. Attrill, 146 U. S. 657 64 Huse v. Glover, 119 U. S. 543 188 Iglehart v. Todd, 203 Ind. 427 482 Illinois Central R. Co. v. Illinois, 163 U. S. 142 186 Tndiana ex rel. Anderson v. Brand, 303 U. S. 95 62, 628 Indian Motocycle Co. v. United States, 283 U. S. 570 222, 389 XXXVIII TABLE OF CASES CITED. Page. Indian Territory Illuminat-ing Oil Co. v. Oklahoma, 240 U. S. 522 384, 389, 390 Indian Territory Oil Co. v. Board of Equalization, 288 U. S. 325 386 Industrial Mut. Dep. Co.’s Receiver v. Taylor, 118 Ky. 851 482 Ingels v. Morf, 300 U. S. 290 189 In re. See name of party. International & G. N. R. Co. v. Hoyle, 149 F. 180 288 International Harvester Co. v. Carlson, 217 F. 736 513 International Paper Co. v. Massachusetts, 246 U. S. 135 82 International Steel Co. v. National Surety Co., 297 U. S. 657 98, 99 Interstate Bldg. & L. Assn. v. Edgefield Hôtel Co., 109 F. 692 289 Interstate Busses Corp. v. Blodgett, 276 U. S. 245 189 Interstate Commerce Comm’n v. Brimson, 154 U. S. 447 437,439 Interstate Commerce Comm’n v. Goodrich Transit Co., 224 U. S. 194 437, 439 Interstate Commerce Comm’n v. Louisville & N. R. Co., 227 U. S. 88 49, 160 lowa Homestead Co. v. Des Moines N. & R. Co., 8 F. 97 295 Jackson, Ex parte, 96 U. S. 727 452 Jacobs v. United States, 290 U. S. 13 238 Jacobson v. Massachusetts, 197 U. S. 11 191 Jacques v. Universal Lubri-cating Systems, 22 F. Supp. 458 549 James v. Dravo Contracting Co., 302 U. S. 134 21, 22, 385 Jaybird Mining Co. v. Weir, 271 U. S. 609 389, 390 Page. Jefferson Standard Life Ins. Co. v. Clemmer, 79 F. 2d 724 171 Jellison v. Krell Piano Co., 246 F. 509 292 John v. Paullin, 231 U. S. 583 139 Johnson v. Chicago, M. & St. P. Ry. Co., 52 Mont. 73 174 Johnson v. Computing Scale Co., 139 F. 339 292 Johnson v. Risk, 137 U. S. 300 213 Johnson v. Southern Pacific Co., 196 U. S. 1 13 Jones v. Portland, 245 U. S. 217 627 Jones v. Western Union Tel. Co., 233 F. 301 292 Jordan v. United States, 36 F. 2d 43 346 Justices, The, v. Murray, 9 Wall. 274 152 Kane v. New Jersey, 242 U. S. 160 189 Kane v. Reserve Oil Corp., 52 F. 2d 972 292 Kanouse v. Martin, 15 How. 198 291, 292, 294 Kansas City Sou. Ry. Co. v. Albers Comm’n Co., 223 U. S. 573 143 Karnuth v. United States, 279 U. S. 231 334 Keeney, In re, 194 N. Y. 281; 222 U. S. 525 302 Kennedy v. Gibson, 8 Wall. 498 483,540 Kentucky Finance Corp. v. Paramount Auto Exchange Corp., 262 U. S. 544 80 Kentucky Railroad T a x Cases, 115 U. S. 321 579 Kentucky Whip & Collar Co. v. Illinois Central R. Co., 299 Ü. S. 334 442 Keyes v. Grant, 118 U. S. 25 140 Kiefer v. Troy School Twp., 102 Ind. 279 101 Kimel v. Missouri State Life Ins. Co., 71 F. 2d 921 289 TABLE OF CASES CITED. XXXIX Page. Kirby v. American Soda Fountain Co., 194 U. S. 141 292, 293 Kline v. Burke Construction Co., 260 U. S. 226 330 Knapp v. Alexander-Edgar Lumber Co., 237 U. S. 162 514 Knight v. U. S. Land Assn., 142 U. S. 161 510, 511, 513 Knights of Pythias v. Meyer, 265 U. S. 30 338 Knowles v. Gaslight & Coke Co., 19 Wall. 58 62 Kodel Electric Co. v. Warren Clock Co., 62 F. 2d 692 550 Kostanzer v. State, 205 Ind. 536 104, 106, 112 Kreiger v. Shelby R. Co., 125 US. 39 99 Kunkel v. Brown, 99 F. 593 289 Kursheedt Mfg. Co. v. Naday, 103 F. 948 550 KVOS v. Associated Press, 299 U. S. 269 288 Lake Benton First Nat. Bank v. Watt, 184 U. S. 151 247 Lake Shore & M. S. R. Co. v. Ohio, 165 U. S. 365 188 Lake Shore & M. S. R. Co. v. Ohio Ex rel. Lawrence, 173 U. S. 285 185, 186 Lambert Run Coal Co. v. Baltimore & Ohio R. Co., 258 U. S. 377 239 Lane County v. Oregon, 7 Wall. 71 222 Langan v. Warren Axe & Tool Co., 184 F. 720 550 Langues v. Green, 282 U. S. 531 410 Large Oil Co. v. Howard, 248 U. S. 549 389, 390 Lauf v. Shinner & Co., 302 U. S. 323 560 Lauf v. Shinner & Co., 82 F. 2d 68 325 Laurel Hill Cemetery v. San Francisco, 216 U. S. 358 191 Law v. United States, 266 U. S. 494 487 Lawrence v. St. Louis-S. F. Ry. Co., 274 U. S. 588 51, 52 Page. Leadville Coal Co. v. Mc- Creery, 141 U. S. 475 281 Leavenworth, L. & G. R. Co. v. United States, 92 U. S. 733 510 Lebensberger v. Scofield, 139 F. 380 295 Lee v. Central of Georgia Ry. Co., 252 U. S. 109 139 Lee v. Watson, 1 Wall. 337 293 Leeds & Catlin Co. v. Victor Talking M. Co., 213 U. S. 301 551 Lees v. United States, 150 U. S. 476 400, 402, 404 Lehigh Valley R. Co. v. United States, 243 U. S. 412 234, 599, 602, 603 Leoles v. Landers, 302 U. S. 656 624 Le Roy v. Hartwick, 229 F. 857. 289 Levering & Garrigues Co. v. Morrin, 71 F. 2d 284 563 Levinski v. Middlesex Banking Co., 92 F. 449 292 Lewellyn v. Frick, 268 U. S. 238 309 Lewis v. Frick, 233 U. S. 291 397 Lewis (O. J.) Mercantile Co. v. Klepner, 176 F. 343 289 Lewis Publishing Co. v. Morgan, 229 U. S. 288 438, 442 Libby v. Hopkins, 104 U. S. 303 248 Liberty National Bank v. Mclntosh, 16 F. 2d 906 541 Liebermann v. Van De Carr, 199 U. S. 552 623 Liggett Co. v. Lee, 288 U. S. 517 84 Liggett & Myers Tobacco Co. v. South Carolina, 291 U. S. 652 619 Lilienthal’s Tobacco v. United States, 97 U. S. 237 403 Linn & Lane Timber Co. v. United States, 236 U. S. 574 572 XL TABLE OF CASES CITED. Page. Lion Bonding & S. Co. v. Karatz, 262 U. S. 77 289 Lipke v. Lederer, 259 U. S. 557 402 Little v. Helvering, 75 F. 2d 436 403 Lloyd Royal Belge, S. A. v. Elting, 61 F. 2d 745 402 Lloyd Sabaudo Societa v. Elting, 287 U. S. 329 400, 402 Locke v. United States, 7 Cranch 339 403 Loewe v. Lawlor, 208 U. S. 274 465 Long v. First Methodist Episcopal Church, 296 U. S. 593 410 Long v. The Tampico, 16 F. 491 75, 76 Los Angeles Gas Co. v. Railroad Comm’n, 289 U. S. 287 139 Louisiana v. Garfield, 211 U. S. 70 510 Louisville & Jeffersonville Ferry Co. v. Kentucky, 188 U. S. 385 82 Louisville Joint Stock Land Bank v. Radford, 295 U. S. 555 355 Louisville & N. R. Co. v. Layton, 243 U. S. 617 15, 16 Low Wah Suey v. Backus, 225 U. S. 460 399 Lucas v. Alexander, 279 U. S. 573 498 Luckenbach S. S. Co. v. United States, 272 U. S. 533 28 Lynch v. Hornby, 247 U. S. 339 120 Lynch v. New York, 293 U. S. 52 213 Lynch v. Turrish, 247 U. S. 221 121 Lyons v. Eagle-Picher Lead Co., 90 F. 2d 321 44 MacColl v. Knowles Loom Works, 95 F. 982 550 Maçon, D. & S. R. Co. v. United States, 78 Ct. Cls. 251; 79 id. 298 238 Page. Madden v. United States, 80 F. 2d 672 7 Maffet v. Quine, 95 F. 199 289 Magliaro v. Modem Homes, Inc., 115 N. J. L. 151 200 Magnano Co. v. Hamilton, 292 U. S. 40 84 Magoun v. Illinois Trust & S. Bank, 170 U. S. 283 578 Mahan v. United States, 14 Wall. 109 29 Maine v. Gilman, 11 F. 214 294 Maine v. Grand Trunk Ry. Co., 142 U. S. 217 186, 256, 583 Manhattan Co. v. Blake, 148 U. S. 412 385 Mannheimer v. Nederland-sche, 6 F. Supp. 564 292 Manufacturers Ry. Co. v. United States, 246 U. S. 457 599 Mars, The, 145 F. 446 528 Mars, The, 149 F. 729 527, 528, 531 Marshall v. International Mercantile Marine Co., 39 F. 2d 551 531 Mast, Foos & Co. v. Stover Mfg. Co., 177 U. S. 485 53 Matter of. See name of party. Maurel v. Smith, 220 F. 195 289 Maxwell v. Dow, 176 U. S. 581 141 May v. Heiner, 281 U. S. 238 309,311 McAllister v. United States, 141 U. S. 174 205 McCandless v. Furlaud, 296 U. S. 140 . 483 McCardle v. Indianapolis Water Co., 272 U. S. 400 147 McCart v. Indianapolis Wa- ter Co., 302 U. S. 419 147 McChord v. Louisville & N. Ry. Co., 183 U. S. 483 52 McCormick v. Burnet, 283 U. S. 784 309, 311 McCulloch v. Maryland, 4 Wheat. 316 222, 385, 387, 388 McDaniel National Bank v. Bridwell, 74 F. 2d 331 248 TABLE OF CASES CITED. XLI Page. McDowell v. Heiner, 9 F. 2d 120; 15 F. 2d 1015 401, 403 McFeely v. Commissioner, 296 U. S. 102 312 McGrath Holding Corp. v. Anzell, 58 F. 2d 205 550 McGregor v. Hogan, 262 U. S. 234 51 McHenry v. Alford, 168 U. S. 651 257 McLoughlin v. Commissioner, 89 F. 2d 699 221 McNeill, In re, 20 App. D. C. 294 550 McNiel, Ex parte, 13 Wall. 236 188 McNutt v. General Motors Acceptance Corp., 298 U. S. 178 287, 288 Meccano Ltd. v. John Wan-amaker, 253 U. S. 136 52, 53 Meeker v. Baxter, 83 F. 2d 183 541, 542 Meredith v. American National Bank, 127 Tenn. 90 249 Merrill v. National Bank of Jacksonville, 173 U. S. 146 411, 412 Metcalf & Eddy v. Mitchell, 269 U. S. 514 21, 222, 385, 389 Metropolitan Casualty Ins. • Co. v. Brownell, 294 U. S. 580 578 Metropolitan Water Co. v. K a w Valley Drainage Dist., 223 U. S. 519 53 Meyer v. Wells, Fargo & Co., 223 U. S. 298 255, 256 Michigan Central R. Co. v. Powers, 201 U. S. 245 579 Michigan Land & Lumber Co. v. Rust, 168 U. S. 589 514 Milheim v. Moffat Tunnel Dist., 262 U. S. 710 51, 627 Miller-Crenshaw Co. v. Colorado Mill Co., 84 F. 2d 930 290 Miller Furniture Co. v. Furniture Workers Union, 8 F. Supp. 209 563 | Page. Milliken v. United States, 283 U. S. 15 302 Mills, In re, 135 U. S. 263 205 Minneapolis, St. P. & S. S. M. Ry. Co. v. Goneau, 269 U. S. 406 13 Minnesota v. Barber, 136 U. S. 313 . 188 Minnesota v. Blasius, 290 U. S. 1 466, 610 Minnesota Rate Cases, 230 U. S. 352 187, 191, 610 Minnesota Tea Co. v. Hel-vering, 302 U. S. 609 566 Mintz v. Baldwin, 289 U. S. 346 188 Mississippi Central R. Co. v. Smith, 295 U. S. 718 626 Mississippi Railroad Comm’n v. Illinois Central R. Co., 203 U. S. 335 186 Mississippi Valley Barge Line Co. v. United States, 292 U. S. 282 235 Missouri, K. & T. Ry. Co. v. Roberts, 152 U. S. 114 510 Missouri, K. & T. Ry. Co. v. United States, 178 F. 15 403 Missouri Pacific R. Co. v. United States, 271 U. S. 603 238 Mitchell v. Overman, 103 U. S. 62 513 Mobile County v. Kimball, 102 U. S. 691 188 Mobile, J. & K. C. R. Co. v. Tumipseed, 219 U. S. 35 170 Montana Central Ry. Co. v. United States, 164 F. 400 244 Moore v. Mississippi, 21 Wall. 636 110 More v. Steinbach, 127 U. S. 70 513 Morehead v. New York ex rel. Tipaldo, 298 U. S. 587 338 Morehouse v. Second National Bank, 30 Htm 628 249 Morf v. Bingaman, 298 U. S. 407 189 Morgan’s Heirs v. Morgan, 2 Wheat. 290 294 XLII TABLE OF CASES CITED. Page. Morgan’s S. S. Co. v. Louisi-ana Board of Health, 118 U. S. 455 188 Morris v. Duby, 274 U. S. 135 189,191 Morris & Co. v. Skandi-navia Ins. Co., 279 U. S. 405 81 Morsman v. Bumet, 283 U. S. 783 309,311 Mueller v. Nugent, 184 U. S. 1 358 Mugler v. Kansas, 123 U. S. 623 627 Muir, Ex parte, 254 U. S. 522 74—76 Mullan v. Torrance, 9 Wheat. 537 294 Mullins Lumber Co. v. Williamson & Brown Land Co., 246 F. 232 289 Muns v. DeNemours, 2 Wash. C. C. 463; Fed. Cas. 9931 291 Mur dock v. Memphis, 20 Wall. 590 98, 99 Murphy v. United States, 272 U. S. 630 397-400, 404 Murphy Oil Co. v. Burnet, 287 U. S. 299 375 Murray v. Joe Gerrick & Co., 291 U. S. 315; 172 Wash. 365 24 Murray’s Lessee v. Hoboken Land & lmp. Co., 18 How. 272 151 Mutual Life Ins. Co. v. Rose, 294 F. 122 290 Myers v. Bethlehem Ship-building Corp., 303 U. S. 41 58 Nashville, C. & St. L. R. Co. v. Alabama, 128 U. S. 96 186 Nashville, C. & St. L. Ry. Co. v. Wallace, 288 U. S. 249 612 National Bank v. Mechanics’ National Bank, 94 U. S. 437 410 National Bank v. Shackle-ford, 239 U. S. 81 508 Page. National Bank of Commerce v. Kenney, 98 Tex. 293 63 National Enameling & S. Co., Ex parte, 201 U. S. 156 53 National Pire Ins. Co. v. Thompson, 281 U. S. 331 52 National Labor Board v. Jones & Laughlin, 301 U. S. 1 47, 49, 52, 58, 266, 464, 466, 469, 470 National Labor Board v. Pennsylvania Greyhound Lines, 303 U. S. 261 273, 274 Navigazione Libéra Tries-tina v. United States, 36 F. 2d 631 402 Neal v. Delaware, 103 U. S. 370 616 Near v. Minnesota, 283 U. S. 697 450, 452 Nebbia v. New York, 291 U. S. 502 8 Nevada County N. G. R. Co. v. United States, 65 Ct. Cls. 327 238 Newhall v. Sanger, 92 U. S. 761 510,518 New Jersey v. Sargent, 269 U. S. 328 443 New Jersey v. Yard, 95 U. S. 104 100 New Jersey & N. Y. R. Co. v. United States, 80 Ct. Cls. 243 238 New Mexico ex rel. McLean & Co. v. Denver & R. G. R. Co., 203 U. S. 38 188 New Orléans & N. E. R. Co. v. Harris, 247 U. S. 367 175 Newport News Shipbuilding & D. D. Co. v. Schauffler, 91 F. 2d 730 44 New Rochelle Water Co., Matter of, v. Maltbie, 248 App. Div. 66 160 Newton v. Consolidated Gas Co., 258 U. S. 165 158 New York, Ex parte, 256 U. S. 503 72 TABLE OF CASES CITED. XLIII Page. New York v. Roberts, 171 U. S. 658 84 New York v. Sohmer, 237 U. S. 276 592 New York Central & H. R. R. Co. v. Kenney, 260 U. S. 340 200 New York Central & H. R. R. Co. v. United States, 165 F. 833 403 New York Central R. Co. v. White, 243 U. S. 188 623 New York, C. & St. L. R. Co. v. Kelly, 70 F. 2d 548 13, 16 New York ex rel. Cohn v. Graves, 300 U. S. 308 582 New York ex rel. N. Y. & Queens Gas Co. v. McCall, 219 N. Y. 84; 245 U. S. 345 160 New York ex rel. .Silz v. Hesterberg, 211 U. S. 31 185, 188, 191 New York, L. E. & W. R. Co. v. Pennsylvania, 158 U. S. 431 257 New York Life Ins. Co. v. Deer Lodge County, 231 U. S. 495 253 New York Life Ins. Co. v. Dodge, 246 U. S. 357 81 New York Life Ins. Co. v. Head, 234 U. S. 149 81 New York Life Ins. Co. v. Ross, 30 F. 2d 80 172 New York, N. H. & H. R. Co. v. Bezue, 284 U. S. 415 468 New York, N. H. & H. R. Co. v. New York, 165 U S. 628 186 New York, N. H. & H. R. Co. v. United States, 251 U. S. 123 229 New York & Philadelphia Package Co., In re, 225 F. 219 361 New York Steam Corp. v. City of New York, 268 N. Y. 137 * 580 Page. New York, W. & B. R. Co. v. Hardy, S. D. N. Y. 603 Ng Fong Ho v. White, 259 U. S. 276 399 Nichols v. Coolidge, 274 U. S. 531 311 Nichols v. New York Life Ins. Co., 88 Mont. 132 170, 172-174 Niles Bernent Pond Co. v. United States, 281 U. S. 357 29 Nixon v. Town Taxi, Inc., 39 F. 2d 618 290 Norfolk & Western Ry. Co. v. Conley, 236 U. S. 605 143 Norris v. Alabama, 294 U. S. 587 64,616 North American T. & T. Co. v. Morrison, 178 U. S. 262 292 North American Transportation & T. Co. v. United States, 253 U. S. 330 238 Northern Pacific Ry. Co. v. North Dakota, 236 U. S. 585 64,143 Northern Securities Co. v. United States, 193 U. S. 197 440 North Laramie Land Co. v. Hoffman, 268 U. S. 276 622 North Missouri R. Co. v. Maguire, 20 Wall. 46 594 North Pacific S. S. Co. v. Soley, 257 U. S. 216 288 Northwestern Mutual Ins. Co. v. Wisconsin, 275 U. S. 136 389 Northwestern Mutual Life Ins. Co. v. Johnson, 254 U. S. 96 344,349 Northwestern Mutual Life Ins. Co. v. McCue, 223 U. S. 234 175 Norton (C. B.) Jewelry Co. v. Hinds, 245 F. 341 361 Nortz v. United States, 294 U. S. 317 57 Océan Accident & G. Corp. v. Schachner, 70 F. 2d 28 172 XLIV TABLE OF CASES CITED. Page. Oceanic Steam Navigation Co. v. Stranahan, 214 U. S. 320 398,400,402 O’Connell v. N. J. Fidelity Ins. Co., 201 App. Div. 117 492 O’Conner v. Watson, 81 F. 2d 833 542 O’ Donoghue v. United States, 289 U. S. 516 111 Office Specialty Mfg. Co. v. Fenton Metallic Mfg. Co., 174 U. S. 492 549 Ogden v. Saunders, 12 Wheat. 213 83, 110, 147 Ohio v. Helvering, 292 U. S. 360 222, 224 Ohio Ins. Co. v. Debolt, 16 How. 416 592 Ohio Oil Co. v. Conway, 281 U. S. 146 579 Ohio Tax Cases, 232 U. S. 576 579 Ohio Valley Co. v. Ben Avon Borough, 253 U. S. 287 50, 139, 154 Oklahoma Cotton Ginners’ Assn. v. State, 174 Okla. 243 209 Oklahoma Natural Gas Co. v. Russell, 261 U. S. 290 209 Old Colony R. Co. v. Commissioner, 284 U. S. 557 122 Old Colony Trust Co.' v. Commissioner, 279 U. S. 716 566 Old Dearborn Co. v. Sea-gram-Distillers Corp., 299 U. S. 183 9 Old Dominion S. S. Co. v.. Virginia, 198 U. S. 299 255 Oliver Iron Min. Co. v. Lord, 262 U. S. 172 258, 579, 610 Operators Piano Co. v. First Wisconsin Trust Co., 283 F. 904 289 Orchard v. Alexander, 157 U. S. 372 514 Oregon-Washington R. & N. Co. v. United States, 205 F. 337 243, 244 Page. Oregon-Washington R. & N. Co. v. United States, 205 F. 341 242 Osaka Shosen Kaisha Line v. United States, 300 U. S. 98 402 Osborn v. U. S. Bank, 9 Wheat. 738 388 Osceola, The, 189 U. S. 158 527, 528 O’Shaughnessy v. Bayonne News Co., 9 N. J. Mise. 345 200 Ouachita Packet Co. v. Ai-ken, 121 U. S. 444 188 Ozawa v. United States, 260 U. S. 178 334 Pacific Co. v. Johnson, 285 U. S. 480 591 Pacific S. S. Co. v. Peter-son, 278 U. S. 130 527 Pacific States Box & Basket Co. v. White, 296 U. S. 176 57 Pacific Tel. & Tel. Co. v. Seattle, 291 U. S. 300 51 Packet Co. v. Catlettsburg, 105 U. S. 559 188 Packet Co. v. Keokuk, 95 U. S. 80 188 Page v. Rogers, 211 U. S. 575 508 Palko v. Connecticut, 302 U. S. 319 450, 621 Palmer v. Bender, 287 U. S. 551 367, 371, 372, 376 Panhandle Oil Co. v. Mississippi ex rel. Knox, 277 U. S. 218 389 Parlement Belge, The, L. R. 4 P. D. 129 74 Passavant v. United States, 148 U. S. 214 400-402 Patapsco Guano Co. v. North Carolina Board of Agriculture, 171 U. S. 345 188 Patterson v. Alabama, 294 U. S. 600 64 Patterson v. Colorado, 205 U. S. 454 . . 452 Paul v. Virginia, 8 Wall. 168 83,253 TABLE OF CASES CITED. XLV Page. Payne v. New Mexico, 255 U. S. 367 514 Peeler v. Lathrop, 48 F. 780 288 Pembina Mining Co. v. Pennsylvania, 125 U. S. 181 84 Pendergast v. Globe & R. Fire Ins. Co., 246 N. Y. 396 345 Penn General Casualty Co. v. Pennsylvania ex rel. Schnader, 294 U. S. 189 281, 282 Pennie v. Reis, 132 U. S. 464 57 Pennsylvania v. West Virginia, 262 U. S. 553 52 Pennsylvania Canal Co. v. Brown, 235 F. 669 277 Pennsylvania Gas Co., Mat-ter of, v. Public Service Comm’n, 211 App. Div. 253 160 Pennsylvania R. Co. •! Page. Railroad Comm’n v. Shupee, 57 S. W. 2d 295: 73 id. 505 157 Randall v. Brigham, 7 Wall. 523 358 Rankin v. City National Bank, 208 U. S. 541 480 Rasmussen v. Idaho, 181 U. S. 198 188 Rast v. Van Deman & Lewis Co., 240 U. 8. 342 578 Ratcliff v. Dick Johnson School Twp., 204 Ind. 525 104 Ratican, In re, 36 App. D. C. 95 550 Ray v. United States, 301 U. S. 158 9 Raymond v. Chicago Union Traction Co., 207 U. S. 20 450 Raymond v. The Ella S. Thayer, 40 F. 902 531 Red “C” Oil Mfg. Co. v. Board of Agriculture, 222 U. S. 380 51, 188 Reddall v. Bryan, 24 How. 420 621 Réduction Co. v. Sanitary Works, 199 U. S. 306 627 Reed, In re, 76 F. 2d 907 550 Reed v. American-German Nat. Bank, 155 F. 233 247 Reed v. Canfield, Fed. Cas. No. 11,641 530, 531 Regai Drug Corp. v. War-dell, 260 U. S. 386 402 Reid v. Colorado, 187 U. S. 137 188, 191 Reid v. United States, 211 U. S. 529 41 Reinecke v. Northern Trust Co., 278 U. S. 339 314 Renland v. First National Bank, 90 Mont. 424 174 Reynolds v. M’Arthur, 2 Pet. 417 314 Reynolds v. United States, 98 U. S. 145 205, 449 Richman v. First Methodist Episcopal Church, 76 F. 2d 344 410 Richmond v. Irons, 121 U. S. 27 410 TABLE OF CASES CITED. XLVII Page. Richmond Hosiery Mills v. Camp, 74 F. 2d 200 52 Riehle v. Margolies, 279 U. S. 218 281 Riggs v. Clark, 71 F. 560 292 Risty v. Chicago, R. I. & P. Ry. Co., 270 U. S. 378 508 Ritter v. Braash, 11 Cal. App. 258 66, 67 Robbins v. Shelby County Taxing Dist., 120 U. S. 489 185 Roberts v. Nelson, 8 Blatchf. 74; Fed. Cas. 11907 292 Robertson v. Baldwin, 165 U. S. 275 529 Robinson v. Anderson, 121 U. S. 522 288 Robinson v. Tubular Woven Fabric Co., 248 F. 526 550 Rogers v. Alemite Corp., 298 U. S. 415 546, 547, 549, 551, 552 Rogers v. Graves, 299 U. S. 401 222 Rogers v. Hennepin County, 240 U. S. 184 98 Rogers v. Hill, 289 U. S. 582 52 Ross v. Day, 232 U. S. 110 29 Royer v. Schultz Belting Co., 135 U. S. 319 31, 140 Royster Guano Co. v. Virginia, 253 U. S. 412 587 St. Joseph Stock Yards Co. v. United States, 298 U. S. 38 50, 85, 139 St. Joseph Stockyards Co. v. United States, 187 F. 104 242, 243 St. Louis Compress Co. v. Arkansas, 260 U. S. 346 81 St. Louis, I. M. & S. R. Co. v. Arkansas, 240 U. S. 518 186 St. Louis, I. M. & S. Ry. Co. v. Taylor, 210 U. S. 281 15 St. Louis Merchants’ Bridge T. Ry. Co. v. United States, 209 F. 600 243 . Page. St. Loms-S. F. Ry. Co. v. Alabama Public Service Comm’n, 279 U. S. 560 51 St. Louis & S. F. R. Co. v. Public Service Comm’n, 254 U. S. 535 186 St. Louis & S. F. R. Co. v. United States, 169 F. 69 243 St. Louis & S. W. R. Co. v. Arkansas, 235 U. S. 350 609 St. Louis-S. W. Ry. Co. v. United States, 183 F. 770 403 St. Paul Plow Works v. Star-ling, 140 U. S. 184 31 St. Tammany Bank & T. Co. v. Winfield, 263 F. 371 289 San Antonio & A. P. Ry. Co. v. Wagner, 241 U. S. 476 61 Sanden v. Morgan, 225 F. 266 398 San Diego Land Co. v. Na- tional City, 174 U. S. 739 147 Sands v. Manistee River lmp. Co., 123 U. S. 288 188 San Francisco v. LeRoy, 138 U- S. 656 511,513 Sanitary Refrigerator Co. v. Winters, 280 U. S. 30 30 San Mateo County v. Southern Pacific Railroad, 116 U. S. 138 87 San Souci v. Compagnie Française de Navigation A Vapeur, 71 F. 2d 651 402 Santa Barbara, The, 263 F. 369 531 Santa Clara County v. Southern Pacific Railroad, 118 U. S. 394 87 Santissima Trinidad, The, 7 Wheat. 283 74 Sapphire, The, 11 Wall. 164 74 Savage v. Jones, 225 U. S. 501 188,463 Sawyer v. Osterhaus, 212 F. 765 506 Schechter Corp. v. United States, 295 U. S. 495 466, 470 Schiller v. Robertson, 28 F. 2d 301 550 XLVIII TABLE OF CASES CITED. Page. School City of Elwood v. State ex rel. Griffin, 203 Ind. 626 105, 113 School City of Lafayette v. Bloom, 17 Ind. App. 461 101 Schuyler National Bank v. Gadsden, 191 U. S. 451 248 Schuylkill Trust Co. v. Pennsylvania, 296 U. S. 113 450 Sclarenco v. Chicago Bond-ing Co., 236 F. 592 289 Scott v. Armstrong, 146 U. S. 499 412, 413 Scott v. Carew, 196 U. S. 100 510 Seaboard Air Line v. See-gers, 207 U. S. 73 579 Seaboard Air Line Ry. v. Blackwell, 244 U. S. 310 187 Seaboard Air Line Ry. Co. v. Watson, 287 U. S. 86 36 Second Employers’ Liability Cases, 223 U. S. 1 464, 623 Security Savings Bank v. California, 263 U. S. 282 282 Security Trust Co. v. Black River National Bank, 187 U. S. 211 281 Selover, Bâtes & Co. v. Walsh, 226 U. S. 112 88 Semler v. Dental Examiners, 294 U. S. 608 623 Senn v. Tile Layers Union, 301 U. S. 468 327, 328, 338, 340, 560, 563 Senn v. Tile Layers Protec- tive Union, 222 Wis. 383 328, 338 Settlemier v. Sullivan, 97 U. S. 444 62 Sexton v. Dreyfus, 219 U. S. 339 411 Shaffer v. Carter, 252 U. S. 37 389 Shappirio v. Goldberg, 192 U. S. 232 . 508 Shaw v. Gibson-Zahniser Oil Corp., 276 U. S. 575 389 Shepherd v. Pepper, 133 U. S. 626 361 Sherman v. Clark, 3 McLean 91; Fed. Cas. 12763 288 Page. Shreveport Case, The, 234 U. S. 342 467 Shwab v. Doyle, 258 U. S. 529 308,309,314 Silas Mason Co. v. Tax Comm’n, 302 U. S. 186 21,23 Siler v. Louisville & N. R. Co., 213 U. S. 175 110 Simecek v. U. S. National Bank, 91 F. 2d 214 289 Simon v. House, 46 F. 317 289 Singer Mfg. Co. v. Cramer, 192 U. S. 265 30 Sklarsky v. Great Atlantic & P. Tea Co., 47 F. 2d 662 295 Slaughter House Cases, 16 Wall. 36 86,87,90 Slick v. United States, 1 F. 2d 897 404 Smelting Co. v. Kemp, 104 U. S. 636 509 Smith v. Alabama, 124 U. S. 465 186 Smith v. Cahoon, 283 U. S. 553 453 Smith v. Greenhow, 109 U. S. 669 290 Smith v. Illinois Bell Tel. Co., 282 U. S. 133 150 Smith v. Kernochen, 7 How. 198 287 Smith v. St. Louis & S. W. R. Co., 181 U. S. 248 188,191 Smith v. Vulcan Iron Works, 162 U. S. 518 53 Smithers v. Smith, 204 U. S. 632 289 Snyder v. Bettman, 190 U. S. 249 385 Snyder v. Massachusetts, 291 U. S. 97 621 Sorensen v. Alaska S. S. Co., 243 F. 280; 247 F. 294 527 Soulard v. United States, 4 Pet. 511 510 South Carolina v. United States, 199 U. S. 437 222,224 Southern Pacific Co. v. Lowe, 247 U. S. 335 121 Southern Pacific Co. v. Schuyler, 227 U. S. 601 64 Southern R. Co. v. Watts, 260 U. S. 519 579 TABLE OF CASES CITED. XLIX Page. Southern Ry. Co. v. United States, 222 U. S. 20 15 Southern Wisconsin Ry. Co. v. Madison, 240 U. S. 457 593 Southwestern Oil Co. v. Texas, 217 U. S. 114 579 Sparta School Twp. v. Men-dell, 138 Ind. 188 101 Springfield Fire & M. Ins. Co. v. National Fire Ins. Co., 51 F. 2d 714 345 Springfield G a s Co. v. Springfield, 257 U. S. 66 624 Sproles v. Binford, 286 U. S. 374 189-191, 195 Sprout v. South Bend, 277 U. S.163 189, 609 Stafford v. Wallace, 258 U. S. 495 464, 466 Standard Fashion Co. v. Magrane-Houston Co., 258 U. S. 346 468 Standard Oil Co. v. Marys-ville, 279 U. S. 582 191, 192 Standard Oil Co. v. United States, 221 U. S. 1 466 Standard Oil Co. v. United States, 283 U. S. 235 234, 600 Stanley v. Schwalby, 162 U. S. 255 63 Stanley v. Supervisors of Albany, 121 U. S. 535 487 Starr Co. v. Brush, 185 App. Div. 261 452 State v. Beckner, 197 lowa 1252 314 State v. Board of School Comm’rs, 205 Ind. 582 107 State v. H. L. Hunt, Inc., 182 La. 1075 609 State v. Nielsen, 57 Mont. 137 174 State v. Ragland, 339 Mo. 452 , 11 State v. Stout, 206 Ind. 58 104 State Corporation Comm’n v. Wichita Gas Co., 290 U. S. 561 50,139 State ex rel. Clark v. Ha- worth, 122 Ind. 462 115,117 State ex rel. Daniel v. John P. Nutt Co., 180 S. C. 19 181 53383°—38-----------Iv Page. State Freight Tax, 15 Wall. 232 186 State Tax Comm’n v. Interstate Natural Gas Co., 284 U. S. 41 611 State Tax on Railway Gross Receipts, 15 Wall. 284 186,256 Station WBT, Inc. v. Poul-not, 46 F. 2d 671 260 Steamship Co. v. Joliffe, 2 Wall. 450 188 Stearns v. United States, 22 Fed. Cas. No. 13,341 401 Stebbins v. Riley, 268 U. S. 137 587 Steigleder v. McQuesten, 198 U. S. 141 287 Stephens v. Cherokee Nation, 174 U. S. 445 205 Stephens v. Monongahela Bank, 111 U. S. 197 247 Stephenson v. Binford, 287 U. S. 251 190 Stewart v. Barnes, 153 U. S. 456 410 Stewart v. United States, 25 F. 2d 869 531 Stewart Dry Goods Co. v. Lewis, 294 U. S. 550 583 Stewart-Warner Corp. v. Jiffy Lubricator Co., 81 F. 2d 786 548 Stewart-Wamer Corp. v. Rogers, 15 F. Supp. 410 549 Stilz v. United States, 269 U. S. 144 29,30 Stockwell v. United States, 13 Wall. 531 401 Stone v. Mississippi, 101 U. S. 814 84 Stone v. United States, 164 U. S. 380 29,30 Stone v. United States, 167 U. 8.178 397,405 Storaasli v. Minnesota, 283 U. S. 57 609 Stromberg v. California, 283 U. S. 359 450 Strother v. Lucas, 12 Pet. 410 510 Stuckert v. Alexander, 4 F. Supp. 172 288 L TABLE OF CASES CITED. Page. Sullivan v. Texas, 207 U. S. 416 61 Summers v. United States, 231 U. S. 92 205 Susquehanna Co. v. Tax Comm’n (No. 2), 283 U. S. 297 619 Swain v. Oklahoma Ry. Co., 168 Okla. 133 209 Swayne & Hoyt v. United States, 300 U. S. 297 270, 271, 275 Swinson v. Chicago, St. P., M. & O. Ry. Co., 294 U. S. 529 15 Tait v. Western Maryland Ry. Co., 289 U. S. 620 397 Tampa Suburban R. Co., In re, 168 U. S. 583 53 Tampa Water Works Co. v. Tampa, 199 U. S. 241 593 Taylor v. United States, 3 How. 197 401 Tennent-Stribling Shoe Co. v. Roper, 94 F. 739 292 Terrace v. Thompson, 263 U. S. 197 52 Texas v. White, 7 Wall. 700 390 Texas Electric Ry. v. Eastus, N. D. Tex., June 4, 1936 603 Texas & N. O. R. Co. v. Brotherhood of Ry. & S. S. Clerks, 281 U. S. 548 266, 267 Texas & N. O. R. Co. v. Sabine Tram Co., 227 U. S. 111 463 Texas & Pacific Ry. Co. v. Pottorff, 291 U. S. 245 483 Texas Transportation Co. v. Seeligson, 122 U. S. 519 295 Therrell v. Commissioner, 88 F. 2d 869 221 Thomas v. Perkins, 301 U. S. 655 367, 371, 376 Thompson v. Maxwell Land Grant Co., 168 U. S. 451 99 Thompson v. Phénix Ins. Co., 136 U. S. 287 361 Thompson v. Utah, 170 U. S. 343 151 Thompson v. Whitman, 18 Wall. 457 62 Page. Torrence v. Shedd, 144 U. S. 527 295 Transportation Co. v. Park-ersburg, 107 U. S. 691 188,190 Transportes Maritimes, Ex Parte, 264 U. S. 105 74 Travelers’ Ins. Co. v. Mc- Conkey, 127 U. S. 661 168,171,173 Travelers’ Ins. Co. v. Wilkes, 76 F. 2d 701 170,172 Travelers’ Protective Assn. v. Smith, 71 F. 2d 511 292 Treigle v. Acme Homestead Assn., 297 U. S. 189 109 Troy Laundry M. Co. v. Bunnell, 27 F. 810 550 Troy Wagon Works Co. v. Ohio Trailer Co., 274 F. 612 550 Truax v. Corrigan, 257 U. S. 312 64,332,340 Truax v. Raich, 239 U. S. 33 52 Trustées v. Picher, 90 F. 2d 741 541 Tschudi v. Metropolitan Life Ins. Co., 72 F. 2d 306 172 Tubbs v. Wilhoit, 138 U. S. 134 508 Tucker v. Spalding, 13 Wall. 453 140 Tug River Coal & Sait Co. v. Brigel, 86 F. 818 295 Tunnicliffe v. Commissioner, 88 F. 2d 873 221 Turmine v. West Jersey & S. R. Co., 44 F. 2d 614 293 Turner v. Maryland, 107 U. S. 38 188 Twin Hills Gasoline Co. v. Bradford Oil Corp., 264 F. 440 292 Twining v. New Jersey, 211 U. S. 78 621 Tyler v. United States, 281 U. S. 497 302,618 Underwood v. Gerber, 149 U. S. 224 550 Underwood Typewriter Co. v. Chamberlain, 254 U. S. 113 255 TABLE OF CASES CITED. LI Page. Ung Lung Chung v. Holmes, 98 F. 323 288, 289 Union Edge Setter Co. v.' Keith, 139 U. S. 530 550 Union Pacific R. Co. v. Hall, 91 U. S. 343 417 Union Pacific R. Co. v. Pub- lic Service Comm’n, 248 U. S. 67 64 Union Refrigerator Transit Co. v. Kentucky, 199 U. S. 194 81 Union Sulphur Co. v. Reid, 17 F. Supp. 27 607 Union Trust Co. v. Illinois Midland Ry. Co., 117 U. S. 434 360 Union Trust Co. v. Wardell, 258 U. S. 537 308 United Business Corp. v. Commissioner, 62 F. 2d 754 405 United Mine Workers v. Coronado Co., 259 U. S. 344 465 United States v. Adams, 6 Wall. 101 29 United States v. American Tobacco Co., 221 U. S. 106 466 United States v. Anderson, 194 U. S. 394 514 United States v. Arzner, 287 U. S. 470 343 United States v. Atlanta, B. & C. R. Co., 282 U. S. 522 235, 599, 601 United States v. Atlantic Coast Line, 182 F. 284 403 United States v. Atlantic Coast Line R. Co., 173 F. 764 244 United States v. Baltimore & O. S. W. R. Co., 159 F. 33; 220 U. S. 94 403 United States v. Bank of New York & T. Co., 296 U. S. 463 282 United States v. Bank of the Metropolis, 15 Pet. 377 415 United States v. Berdan Fire-Arms Co., 156 U. S. 552 30 Page. United States v. Burchard, 125 U. S. 176 415 United States v. Burroughs, 289 U. S. 159 205 United States v. Butler, 297 U. S. 1 587 United States v. Cervantes, 18 How. 553 521 United States v. Chouteau, 102 U. S. 603 402 United States v. Claflin, 97 U. S. 546 401, 403 United States v. Clark, 96 U. S. 37 30 United States v. Conway, 175 U. S. 60 509 United States v. Coronado Beach Co., 255 U. S. 472 513 United States v. Corrick, 298 U. S. 435 229, 234, 600 United States v. Dakota- Montana Oil Co., 288 U. S. 459 312, 367, 381 United States v. Delaware & Hudson Co., 213 U. S. 366 442 United States v. Domangue, 79 F. 2d 647 343 United States v. Donaldson- Schultz Co., 148 F. 581 398 United States v. Esnault-Pelterie, 299 U. S. 201 27, 29, 31 United States v. Ferreira, 13 How. 40 511 United States v. Fossatt, 21 How. 445 516, 524 United States v. Great Falls Mfg. Co., 112 U. S. 645 238 United States v. Greathouse, 166 U. S. 601 572 United States v. Griffin, 303 U. S. 226 599, 601, 603 United States v. Grimaud, 220 U. S. 506 9 United States v. Heth, 3 Cranch 399 314 United States v. Illinois Cent. R. Co., 244 U. S. 82 235,599 United States v. Illinois Central R. Co., 291 U. S. 457 51, 235 LU TABLE OF CASES CITED. Page. United States v. Illinois Central R. Co., 170 F. 542 403,404 United States v. Kansas City Southern Ry. Co., 202 F. 828 243 United States v. Kapp, 302 U. S. 214 7, 8 United States v. Knox, 102 U. S. 425 541 United States v. La Franca, 282 U. S. 568 396,402,406 United States v. Larkin, 18 How. 557 520,521 United States v. Larkin, 208 U. S. 333 40 United States v. Los Angeles & S. L. R. Co., 273 U. S. 299 52,234,235,599,601 United States v. Louisiana, 127 U. S. 182 515 United States v. Louisville & N. R. Co., 167 F. 306 403 United States v. Louisville & N. Ry. Co., 162 F. 185; 174 F. 1021 ’ 403 United States v. Ludey, 274 U. S. 295 367,381 United States v. Magnolia Petroleum Co., 276 U. S. 160 314 United States v. Memphis Cotton Oil Co., 288 U. S. 62 200 United States v. Mill Creek, 251 U. S. 539 40 United States v. Minneapolis, St. P. & S. S. M. Ry. Co., 235 F. 951 404 United States v. Minnesota, 270 U. S. 181 509 United States v. Murdock, 290 U. S. 389 242,398 United States v. Nashville, C. & St. L. Ry. Co., 118 U. S. 120 416 United States v. New York Central R. Co., 279 U. S. 73; 65 Ct. Cls. 115 238 United States v. North Caro-lina, 136 U. S. 211 410 United States v. Olsen, 57 F. 579 404 Page. United States v. Omaha In-dians, 253 U. S. 275 30 United States v. Osio, 23 How. 273 520 United States v. Peralta, 19 How. 343 520 United States v. Percheman, 7 Pet. 51 510 United States v. Perkins, 163 U. S. 625 385 United States v. Reading, 18 How. 1 520 United States v. Regan, 232 U. S. 37 400,402,403 United States v. Repentigny, 5 Wall. 211 510 United States v. Ritchie, 17 How. 525 514,524 United States v. Safety Car Heating & L. Co., 297 U. S. 88 312,500 United States v. St. Louis- S. W. Ry. Co., 184 F. 28 404 United States v. Sanges, 144 U. S. 310 404 United States v. Scharton, 285 U. S. 518 398 United States v. Schneider, 35 F. 107 398 United States v. Schurz, 102 U. S. 378 509 United States v. Shreveport Grain Co., 287 U. S. 77 9 United States v. Sioux City Stock Yards Co., 162 F. 556 242 United States v. Smith, 94 U. S. 214 29 United States v. Southern Pacific Co., 172 F. 909 404 United States v. State In-vestment Co., 264 U. S. 206 508 United States v. Stevenson, 215 U. S. 190 402 United States v. Stockyards Terminal Ry. Co., 178 F. 19 242,243 United States v. Stollar, 180 F. 910 513 United States v. Swift & Co., 270 U. S. 124 30 TABLE OF CASES CITED. LUI Page. United States v. Thompson, 41 F. 28 403 United States v. Three Cop-per Stills, 47 F. 495 404 United States v. Ward, 257 F. 372 358 United States v. Warner Bros. Pictures Inc., 13-F. Supp. 614 398 United States v. Wells, 283 U. S.102 31 United States v. West Virginia, 295 U. S. 463 443 United States v. Wiltberger, 5 Wheat. 76 248 United States v. Zucker, 161 U. S. 475 400,403,404 U. S. Express Co. v. Minnesota, 223 U. S. 335 256,257 U. S. ex rel. Bilokumsky v. Tod, 263 U. S. 149 399,404 U. S. ex rel. Handler v. Hill, 90 F. 2d 573 9 U. S. Fidelity & G. Co. v. Bray, 225 U. S. 205 53 U. S. Glue Co. v. Oak Creek, 247 U. S. 321 255,389,610 U. S. National Bank v. Pôle, 2 F. Supp. 153 541 Urquhart v. Brown, 205 U. S. 179 624 Utah-Idaho Cent. Ry. v. Shields, D. Utah, Oct. 15, 1936 603 Utah Power & L. Co. v. Pfost, 286 U. S. 165 7, 254,258, 259,434,611 Utley v. St. Petersburg, 292 U. S. 106 99 Vance v. W. A. Vandercook Co., 170 U. S. 468 289 Varions Items v. United States, 282 U. S. 577 400,404 Veazie Bank v. Fenno, 8 Wall. 533 222,223 Verden v. Coleman, 18 How. 86 621 Vicksburg Waterworks Co. v. Vicksburg, 185 U. S. 65 52 Violet Trapping Co. v. Grâce, 297 U. S. 119 593 Virginia v. Impérial Coal Sales Co., 293 U. S. 15 98 Page. Virginian Ry. Co. v. System Fédération No. 40, 300 U. S. 515 266 Virginia Securities Corp. v. Patrick Orchards, 20 F. 2d 78 361 Wabash, St. L. & P. R. Co. v. Illinois, 118 U. S. 557 185 Waite v. Phoenix Ins. Co., 62 F. 769 292,294 Walker v. Sauvinet, 92 U. S. 90 141 Walker Grain Co. v. South- western Tel. & Tel. Co., 10 F. 2d 272 288, 289 Wall, Ex parte, 107 U. S. 265 399 Walla Walla v. Walla Walla Water Co., 172 U. S. 1 52 Walnut v. Wade, 103 U. S. 683 487 Wanderer, The, 20 F. 140 528 Wannamaker v. Edisto Na- tional Bank, 62 F. 2d 696 538,541 Ward v. Love County, 253 U. S. 17 62,64,450 Ward v. Mulford, 32 Cal. 365 513 Ware & Leland v. Mobile County, 209 U. S. 405 253 Warner v. Goltra, 293 U. S. 155 92-94 Washington-Alaska Bank v. Dexter Horton National Bank, 263 F. 304 413 Washington County v. Wil- liams, 111 F. 801 288,289 Washington Securities Co. v. United States, 234 U. S. 76 508 Waterman v. Canal-Loui- siana Bank & T. Co., 215 U. S. 33 281 Watson v. Maryland, 218 U. S. 173 623 Watson v. Sutherland, 5 Wall. 74 52 Wensleydale, The, 41 F. 829 527, 529 West Bros. Brick Co. v. Alexandria, 302 U. S. 658 627 LIV TABLE OF CASES CITED. Page. Page. West Coast Hôtel Co. v. Parrish, 300 U. S. 379 85 West Ohio Gas Co. v. Public Utilities Comm’n (No. 1), 294 U. S. 63 139,143 Western & Atlantic R. Co. v. Georgia Public Service Comm’n, 267 U. S. 493 51 Western & Atlantic R. Co. v. Henderson, 279 U. S. 639 170 Western Distributing Co. v. Public Service Comm’n, 285 U. S. 119 149,150 Western Live Stock v. Bureau of Revenue, 303 U. S. 250 583, 610,612,613 Western Turf Assn. v. Greenberg, 204 U. S. 359 88 Western Union Tel. Co. v. Attorney General, 125 U. S. 530 255 Western Union Tel. Co. v. James, 162 U. S. 650 185 Western Union Tel. Co. v. Kansas, 216 U. S. 1 82,185 Western Union Tel. Co. v. Missouri ex rel. Gottlieb, 190 U. S. 412 255 Western Union Tel. Co. v. Pendleton, 122 U. S. 347 185 Westmoreland, In re, 4 F. 2d 602 361 Weston v. Charleston, 2 Pet. 449 222,386 Wetmore v. Rymer, 169 U. S. 115 289 White v. Aronson, 302 U. S. 16 314 White v. Johnson, 282 U. S. 367 51 White v. Knox, 111 U. S. 784 411 White v. Schloerb, 178 U. S. 542 358 Whitney v. California, 274 U. S. 357 213 Whitney v. Olsen, 108 F. 292 528 Wichita R. & Light Co. v. Public Utilities Comm’n, 260 U. S. 48 295 Wickham v. Commissioner, 65 F. 2d 527 403 Wiedmer, In re, 82 F. 2d 566 358 Wight, In re, 134 U. S. 136 513 Wilcox v. Jackson, 13 Pet. 498 510 Wilderman v. Roth, 17 F. 2d 486 289 Willamette Iron Bridge Co. v. Hatch, 125 U. S. 1 188 Willcuts v. Bunn, 282 U. S. 216 385,386,389 Williams v. Fears, 179 U. S. 270 253 Williams v. Nelson, 228 Mass. 191 492 Williams v. Nottawa, 104 U. S. 209 288,289 Williams v. Standard Oil Co., 278 U. S. 235 434 Willis v. Oscar Daniels Co., 200 Mich. 30 24 Willson v. Black Bird Creek Marsh Co., 2 Pet. 245 185,188 Wilson v. Daniel, 3 Dali. 401 288 Wilson v. Manhattan Can-ning Co., 205 F. 996 531 Wilson v. McNamee, 102 U. S. 572 188 Wisconsin Central Railroad v. United States, 164 U. S. 190 415 Wisconsin & M. Ry. Co. v. Powers, 191 U. S. 379 256 Withers v. Pacific Mutual Life Ins. Co., 58 Mont. 485 174 Witzelberg v. Cincinnati, 302 U. S. 635 622,623 Wood v. Johnston, 8 Cal. App. 258 66,67 Wood v. United States, 204 U. S. 55 404 Wood Mowing & R. Machine Co. v. Skinner, 139 U. S. 293 213 Woods v. Massachusetts Protective Assn., 34 F. 2d 501 294 TABLE OF CASES CITED. lv Page. Woolsey v. Best, 299 U. S. 1 621 Worcester County Trust Co. v. Rüey, 302 U. S. 292 191 Work v. U. S. ex rel. O’Don- nell, 23 F. 2d 136 506, 508, 509,516 Worthen Co. v. Kavanaugh, 295 U. S. 56 109 Worthen Co. v. Thomas, 292 U. S. 426 109 Wright v. Roseberry, 121 U. S. 488 509 Wright v. United States, 302 U. S. 583 111 Wright v. Vinton Branch, 300 U. S. 440 355, 356,360,361 Wright v. Wells, Pet. C. C. 220; Fed. Cas. 18101 292 Yale Lock Mfg. Co. v. Berkshire Nat. Bank, 17 F. 531 550 Page. Yarborough v. Yarborough, 168 S. C. 46; 290 U. S. 202 64 Yaselli v. Goff, 275 U. S. 503 358 Yates v. Jones National Bank, 206 U. S. 158 248 Yeiser v. Dysart, 267 U. S. 540 8 Yonley v. Lavender, 21 Wall. 276 281 Young (Frank L.) Co. v. McNeal-Edwards Co., 283 U. S. 398 68 Youtsey v. Hoffman, 108 F. 699 295 Zahn v. Board of Public Works, 274 U. S. 325 191 Zakonaite v. Wolf, 226 U. S. 272 399 Zinkeisen v. Hufschmidt, 1 Cent L. J. 144; Fed. Cas. 18214 292 TABLE OF STATUTES Cited In Opinions (A) Statutes of the United States Page. 1789, July 31, c. 5, § 36, 1 Stat. 29 .............. 400 1789, Sept. 24, c. 20, § 12, 1 Stat. 73..................... 286 1789, Sept. 24, c. 20, § 25, 1 Stat. 85...................... 98 1799, Mar. 2, c. 22, § 71, 1 Stat. 627.................... 403 1823, Mar. 3, c. 58, 3 Stat. 781............'............. 401 1850, Sept. 28, c. 84, 9 Stat. 519...........................504 1851, Mar. 3, c. 41, 9 Stat. 631 ..................... 504, 512 1852, Aug. 31, c. 108, § 12, 10 Stat. 76.................. 505 1863, Mar. 3, c. 92, 12 Stat. 765 .......................... 28 1863, Mar. 3, c. 92, § 10, 12 Stat. 765.................... 569 1864, June 3, c. 106, 13 Stat. 99 539 1866, July 23, c. 219, 14 Stat. 218.................... 508 1866, July 27, c. 288, 14 Stat. 306 ................... 286 1867, Feb. 5, c. 28, § 2, 14 Stat. 386..................... 98 1872, June 7, c. 322, § 61, 17 Stat. 262.................. 92-94 1872, June 7, c. 322, § 65, 17 Stat. 277.................. 92,93 1874, June 9, c. 260, 18 Stat. 64............................ 94 1874, June 22, c. 390, § 17, 18 Stat. 178..................... 354 1875, Mar. 3, c. 137, 18 Stat. 470 ............... 286, 290, 291 Page. 1875, Mar. 3, c. 137, § 5, 18 Stat. 472.............. 287 1887, Feb. 4, c. 104, 24 Stat. 379 .......................... 236 1887, Feb. 4, c. 104, § 5, 24 Stat. 380.............. 317 1887, Mar. 3, c. 359, 24 Stat. 506 .......................... 38 1887, Mar. 3, c. 359, § 4, 24 Stat. 505..................... 28 1887, Mar. 3, c. 359, §§ 5, 6, 24 Stat. 505................. 568 1887, Mar. 3, c. 373, § 1, 24 Stat. 552.................... 286 1888, Aug. 13, c. 866, § 1, 25 Stat. 433 ................... 286 1890, July 10, c. 664, §§ 4, 5, 26 Stat. 222 .......... 383 1893, Mar. 2, c. 196, 27 Stat. 531 ......................... 235 1893, Mar. 2, c. 196, § 8, 27 Stat. 532..................... 12 1903, Feb. 11, c. 544, 32 Stat. 823 ......................... 232 1903, Mar. 2, c. 976, 32 Stat. 943 ......................... 235 1906, June 29, c. 3591, § 5, 34 Stat. 584 .......... 232 1906, June 29, c. 3594, §§ 1 to 4, 34 Stat. 607 ..................... 240-244 1907, Feb. 20, c. 1134, 34 Stat. 898.................... 402 1907, Mar. 4, c. 2939, 34 Stat. 1415................... 236 1908, Apr. 22, c. 149, § 4, 35 Stat. 65................ 13 lvii LVIII TABLE OF STATUTES CITED. Page. 1908, May 30, c. 225, 35 Stat. 476 ................... 236 1908, May 30, c. 234, 35 Stat. 554 ................... 236 1909, Mar. 4, c. 321, 35 Stat. 1088 236 1910, Apr. 14, c. îèÔ, 36 Stat. 9QR 935 1910, Apr. 14* c. 160, § 2, 36 Stat. 298..................... 12 1910, Apr. 14, c. 160, § 4, 36 Stat. 299..................... 16 1910, May 6, c. 208, 36 Stat. 350 ......................... 236 1910, June 18, c. 309, 36 Stat. 539 .............. 227,232, 237 239 1910, June 25, c. 115, 36 Stat. 251................ 28,29 1911, Feb. 17, c. 103, 36 Stat. 913 ............... 234,235 1911, Mar. 3, c. 231, §§ 24, 28, 36 Stat. 1087.... 286 1911, Mar. 3, c. 231, § 37, 36 Stat. 1098................ 287 1912, Aug. 24, c. 390, 37 Stat. 560.................... 602 1913, Mar. 1, c. 92, 37 Stat. 701 ......................... 235 1913, Mar. 4, c. 160, 37 Stat. 1013......................... 237 1913, Mar. 4, c. 169, 38 Stat. 1192 ........................ 234 1913, Oct. 22, c. 32, 38 Stat. 208 ............... 227, 239,597 1913, Dec. 23, c. 6, § 23, 38 Stat. 273.................... 534 1914, Oct. 15, c. 223, 38 Stat. 730.................... 236 1914, Oct. 15, c. 323, § 20, 38 Stat. 730................. 562 1915, Mar. 4, c. 153, § 12, 38 Stat. 1164...............91-94 1916, July 28, c. 261, 39 Stat. 412.................... 235 1916, July 28, c. 261, § 5, 39 Stat. 412.... 227, 229 1916, Sept. 7, c. 451, 39 Stat. 728.................... 236 1916, Sept. 8, c. 463, § 202, 39 Stat. 777........... 308 Page. 1917, Oct. 6, c. 105, § 400, 40 Stat. 409 ................ 343 1918, Mar. 19, c. 24, 40 Stat. 450................... 236 1918, July 1, c. 114, 40 Stat. 705.......................... 28 1918, July 2, c. 117, 40 Stat. 742 .................... 232,235 1919, Feb. 24, c. 18, § 402, 40 Stat. 1057............... 309 1920, Feb. 28, c. 91, 41 Stat. 456..................... 235,236 1920, Feb. 28, c. 91, § 407,41 Stat. 480................... 317 1920, June 5, c. 250, 41 Stat. 988 ......................... 93 1921, Mar. 4, c. 172, 41 Stat. 1445 ....................... 236 1921, Aug. 15, c. 64, 42 Stat. 159 ........................ 236 1922, June 7, c. 210, 42 Stat. 624 235 1922, June là/c.” 227,7 42 Stat. 652................... 235 1924, Feb. 13, c. 18, 43 Stat. 7............................236 1924, June 2, § 201, c. 234, 43 Stat. 253................... 121 1924, June 3, c. 243, 43 Stat. 360 .................... 234,236 1924, June 7, c. 355, 43 Stat. 659 .................... 234,235 1925, Feb. 13, c. 229, 43 Stat. 936 .............. 205, 236, 237 1925, Feb. 13, c. 229, § 3, 43 Stat. 936................... 28 1925, Feb. 13, c. 229, § 8, 43 Stat. 936 .............. 203,626 1925, Feb. 28, c. 368, 43 Stat. 1053 ....................... 235 1926, Feb. 26, c. 27, § 302, 44 Stat. 9 .......... 298, 304, 308 1926, Feb. 26, c. 27, § 1113, 44 Stat. 9.................. 568 1926, May 20, c. 347, 44 Stat. 577 ........................ 236 1927, Feb. 23, c. 169, 44 Stat. 1162 ....................... 236 1927, Mar. 4, c. 510, 44 Stat. 1450 ....................... 236 TABLE OF STATUTES CITED. LIX Page. 1928, May 29, c. 852, §§ 13, 21, 22, 112, 45 Stat. 791 .......................... 565 1928, May 29, § 115, c. 852, 45 Stat. 791........... 119 1928, May 29, c. 852, § 293, 45 Stat. 791.................. 395 1928, May 29, c. 852, § 610, 45 Stat. 791............415 1928, May 29, c. 856, 45 Stat. 940 .......................... 235 1928, May 29, c. 891,45 Stat. 978 ...................... 235,236 1930, July 3, c. 849, 46 Stat. 992............................ 38 1930, July 3, c. 849, § 24, 46 Stat. 1001.................... 342 1930, June 10, c. 436,46 Stat. 531 .......................... 236 1931, Mar. 3, c. 454, 46 Stat. 1516 .................... 298,304 1932, Mar. 23, c. 90, § 7, 47 Stat. 71...................... 329 1932, Mar. 23, c. 90, § 1, 47 Stat. 70...................... 335 1932, Mar. 23, c. 90, § 2, 47 Stat. 70...................... 333 1932, Mar. 23, c. 90, § 13, 47 Stat. 70 ................. 329,554 1932, June 6, c. 209, §§ 181, 182, 47 Stat. 169.... 496 1932, June 6, c. 209, § 803, 47 Stat. 169 ................ 301,305 1932, June 6, c. 209, § 1104, 47 Stat. 169............416 1932, July 21, c. 520, 47 Stat. 711........................... 236 1933, Feb. 24, c. 119, 47 Stat. 904 .......................... 203 1933, Mar. 3, c. 204, 47 Stat. 1467 ......................... 354 1933, Mar. 3, c. 204, § 1, 47 Stat. 1470.................... 355 1933, Mar. 3, c. 204, § 77, 47 Stat. 1474 ................... 236 1933, Mar. 23, c. 5, 48 Stat. 90 93R 1933, May 27, c.’ 38, § 6, 48 Stat. 74 ..................... 438 1933, June 13, c. 64, 48 Stat. 134.............................. 3 ] Page. 1933, June 16, c. 91, 48 Stat. 211.....................236 1934, Mar. 8, c. 49, 48 Stat. 399 203 1934, Apr. 27, c.’ 168,' 48 Stat. 643 ..................... 4 1934, Apr. 27, c. 168, § 12,48 Stat. 643 .................... 3 1934, June 7, c. 424, 48 Stat. 911.................... 354 1934, June 7, c. 424, §§ 8, 9, 48 Stat. 911............355 1934, June 12, c. 466, 48 Stat. 933 .......... 235 1934, June 16, c. 545, 48 Stat. 968........... 236 1934, June 19, c. 652, 48 Stat. 1064.......... 236 1934, June 21, c. 691, 48 Stat. 1185...... 236,597 1934, June 26, c. 756, § 17, 48 Stat. 1224.......... 280 1934, June 26, c. 762, 48 Stat. 1243.................. 235 1934, June 28, c. 869, 48 Stat. 1289......... 354,355 1935, Jan. 31, c. 2, 49 Stat. 1............................ 236 1936, Apr. 10, c. 166, 49 Stat. 1189.......... 236 1935, June 14, c. 247, 49 Stat. 376........... 236 1936, June 29, c. 858, 49 Stat. 1985...... 236,237 1935, July 5, c. 372, § 8, 49 Stat. 449 ... 43,262 1935, Aug. 9, c. 498, 49 Stat. 543. 181,236 1935, Aug. 26, c. 687, §§ 4, 5, 49 Stat. 803.... 427 1935, Aug. 27, c. 774, 49 Stat. 911......... 236 1935, Aug. 28, c. 792, 49 Stat. 942. 355,356 1935, Aug. 29, c. 803, 49 Stat. 958......... 236 1936, Apr. 11, c. 210, 49 Stat. 1203......... 355 1936, Apr. 10, c. 186, 49 Stat. 1198 ........ 355 lx TABLE OF STATUTES CITED. Page. 1936, June 25, c. 822, 49 Stat. 1938.......... 25 1937, Jan. 26, c. 6, 50 Stat. 5.................. 236 1937, May 20, c. 229, 50 Stat. 189......... 236 1937, Aug. 16, c. 657, 50 Stat. 653......... 355 1937, Aug. 24, c. 754, 50 Stat. 751......... 237 Constitution. See Index at end of volume. Criminal Code. § 35..................... 6,202 § 215........................ 33 § 233 236 Judicial Code. § 24................... 286 § 24 (20)............. 568 § 37........................ 287 § 211........................239 § 266.............. 182, 237, 608 § 237 .... 208,252,279 § 237 (a).......... 78,577 § 238 (3)............. 608 Revised Statutes. § 905........................ 62 § 995....................... 277 § 996 ............. 277, 279, 282 §4612........................ 93 § 5151.......................534 §5197................... 245,248 §5198 .................. 246,248 § 5236...................... 411 U. S. Code. Title 11, § 108 (a)....248 § 110 (a).........247 Title 12, § 33.......... 534,538 § 34 534 §§ 63 , 64 ....... 534 § 85 245 § 86 246 § 264 et seq.......484 § 248 (k).........408 § 1467 3,4 Title 15, § 13.......... 464,468 § 14........................ 468 Title 18, § 80 ............. 202 § 338 33 U. S. Code—Continued. Page. Title 21, §§ 1 to 26 ................. 463 Title 26, § 411 (c)............. 298-305 §411 (h) ........ 308 Title 28, § 41.................. 286 § 41 (6)...................238 § 41 (20)................. 568 §§ 41 (28), 46, 47.. 597 § 48 .............. 239 § 80 ..................... 287 § 225 ................. 203,205 § 230 .................... 205 § 344 .................... 208 § 344 (a).............. 78,577 § 345 (3)................. 608 § 380.. 18,127,155,608 § 687 ............ 62 § 723a.................... 203 § 725 .................... 175 § 761...................... 28 § 762 ................. 38,40 § 763 ................. 39,40 § 765 ..................... 40 § 773 .................... 487 § 851, 852................ 277 § 875.... 215,217,487 Title 29, § 52 ................. 562 § 101 ................. 335,340 § 101 et seq...............329 § 102 ................. 333,340 § 104 .................... 561 § 107 ................. 329,562 § 113 ................. 329,554 § 113 (c)............. 336,564 § 151 et seq.............. 262 Title 35, § 68............... 28 Title 38, §§ 447, 518 ..... 349 Title 39, § 102 ....... 335 § 233 ....... 438 § § 523 to 568.... 229 § 524 ....... 227 §§ 524 to 568 ... 231 § 541 ..... 227 § 542 ....... 230 §§ 544 to 554.... 231 § 549 ....... 230 §§ 551, 553 ..... 231 TABLE OF STATUTES CITED. lxi U. S. Code—Continued. Page. Title 45, § 7 .................... 12,16 § H...................... 12 § 13..................... 16 § 54.................... 13,16 §§ 71-74 ................. 240 §151...................... 597 § 152 (10)................ 601 Title 46................... 93 § 544 ..................... 94 § 601................... 91,93 §713.................... 93,94 Title 48, § 645 ...... 203,205 Title 49, § 1 (18). 319 § 5 (1)........ 317 § 13 (4) ........467 Accident Investigation Act. 236 Air Mail Act.............. 235 Anti-Trust Act............ 465 Bankruptcy Act. § 12 ........... 358,359 §§ 38, 39................ 357 §68 (a)....... 246,248 § 70 (a)........... 247 § 75 351-360 § 77 236,318 Bankruotcy Act, 1867 .... 354 Boiler Inspection Act... 234,235 Clayton Antitrust Act.... 236, 464,562 Commerce Court Act....... 234 Communications Act, 1934. 236 Electric Railway Mail Pay Act.................... 232,235 Emergency Railroad Transportation Act, 1933.. 236 Expediting Act, 1903..... 232 Frazier-Lemke Act......... 355 Fédéral Declaratory Judg-ment Act............. 443 Fédéral Employers’ Lia-bility Act........... 467 § 4....................... 13 Fédéral Food & Drugs Act. 463 Fédéral Motor Carrier Act, 1935 .................. 181 Fédéral Reserve Act. § 11......................408 § 11 (k)...... 409,412 Fédéral Safety Appliance Act................ 11,12 Page. Fédéral Trade Commission Act................. 48 Fourth. Class Mail Régulations Act.......... 235 Hepburn Act, 1906, §5... 232 Home Owners’ Loan Act, § 9......................... 7 Home Owners’ Loan Act, 1933, § 8.......... 3-9 Hours of Service Act......236 Inland Waterways Corpora- tion Act.............. 234,236 Interstate Commerce Act.. 235 Part II............. 236 § 1 (18)............ 319 § 5....................... 317 § 5 (1)......... 319-322 Joint Resolution of Mar. 3, 1931 ................. 298-314 Judiciary Act, 1789. § 12...................... 286 § 25....................... 98 Judiciary Act, 1875....... 286 Judiciary Act, 1887.... 286,287 Judiciary Act, 1888.... 286,287 Judiciary Act, 1937........ 237 Locomotive Ash Pan Act.. 236 Merchant Marine Act, 1920. 93 Merchant Marine Act, 1936. 237 Mexican Claims Act, 1851.. 504, 512-518 Motor Carrier Act, 1935.. 236 National Bank Act, 1864.. 539 National Banking Act......538 National Labor Relations Act............... 43-46,464 § 1................ 266 § 2................ 467 § 5................. 58 § 7. .......... 263-270 § 8. .. 55,262-267,274,460 § 9 270, 271 § 10........................50, 55, 58, 263-270, 273, 275 § 11....................... 49 New York City Pneumatic Tube Mail Pay Act.. 235 Norris-LaGuardia Act .... 327-340, 559 §§ 4, 7................... 561 § 13 329,554,560 Organic Act of Hawaii.... 205 LXII TABLE OF STATUTES CITED. Page. Packers & Stockyards Act, 1921 ............... 236 Panama Canal Act.......... 602 Perishable Agricultural Com-modities Act, 1930... 236 Permanent Appropriation Repeal Act, 1934, § 17.................. 280 Public Utility Holding Company Act, 1935.. 426-433 Radio Act, 1927........... 236 Railway Labor Act...... 236, 267,597,601 § 1...................... 599 Railway Labor Act, 1926, § 2..................266 Railway Mail Pay Act.... 228, 229,235-239 Railway Mail Pay Act, 1916................ 238 § 5...................... 227 Reconstruction Finance Corporation Act........ 236 Revenue Act, 1918. § 218............... 500 § 402 309 Revenue Act, 1921, § 402.. 309 Revenue Act, 1924. § 201............... 121 § 302 309 Revenue Act, 1926....... 568 § 204........... 366, 371, 378 §214..................... 371 § 234........... 366, 378 § 302........... 298, 304-313 Revenue Act, 1928....... 122 §§ 13, 21, 22....... 565 § 23 .................... 366 § 104 ................... 405 § 112 .......... 565-567 § 114........... 366, 373 § 115...........119, 121 § 146............ 395, 396, 404 (B) STATUTES OF THE California. Constitution, Art. XIII, § 14 .................... 78 1854 Stats. c. 43, pp. 48-49 ..................... 522 1921 Stats. c. 22, pp. 20, 21................... 78 Page. Revenue Act, 1928—Continued. § 182 .............. 501 § 276 401 §§ 291, 292........... 405 § 293 395, 399, 401, 405, 406 § 294 405 § 610 415-418 § 614............... 417 Revenue Act, 1932......... 417 §§ 11, 12............. 500 § 41............ 498-501 §§ 48, 181............ 496 § 182 .......... 496-501 § 189 .............. 496 § 803...............301, 304, 307, 312-314 § 1104.............. 416 Revenue Act, 1934, § 506.. 312 Safety Appliance Act.......235 St. Louis Bridge Act.......236 Standard Time Zone Act.. 236 Securities Act, 1933, § 6... 438 Shipping Act, 1916........ 236 Swamp Lands Act, 1850 . 504—520 § 2....................... 509 Transportation Act, 1920 319, 320 Title II.............. 235, 236 Transportation of Explosives Act........... 236 Tucker Act.....38,238,569-571 §§ 5,6............... 38,40,568 Urgent Deficiencies Act.... 227, 228, 232-238,597-603 Valuation Act............. 235 War Risk Insurance Act.. 344, 346 § 400 .................... 343 World War Vétérans Act, 1924 ............... 347 § 19....................38, 40 § 307 .................... 342 PATES AND TeRRITORIES California—Continued. 1923 Stats. pp. 518, 519, 536 ................. 488 1927 Stats. p. 1427.... 488 1931 Stats. p. 2108.... 488 Code of Civil Proc., § 442 .................. 65,67 § 1015.................. 66,67 TABLE OF STATUTES CITED. LXIII Page. California—Continuée!. Political Code, § 3664b. 78 Vehicle Act...................488 Georgia. Ordinance, City of Grif-fin, §§ 1, 2............447 Indiana. Constitution............ 115,116 Art. 8, § 1...... 111 1899 G. L. p. 173, Act of Feb. 28, 1899; Burns’ Ind. Stat. Ann. 1933, §§ 28-4302, 4303 ................... 101 1921 Acts, p. 195, Act of Mar. 7, 1921; Burns’ Ind. Stat. Ann. 1933, § 28-4304......... 101 1927 Acts, p. 259, Act of Mar. 8, 1927; Burns’ Ind. Stat. Ann. Supp. 1929, § 6967.1. 101 1933 Acts, p. 716, Act of Mar. 1, 1933; Burns’ Ind. Stat. Ann. 1933, § 28-4307..... 104, 107-109 Teachers’ Tenure Law. 97, 98 Teachers’ Tenure Act, 1927 ......... 104, 109-115 § 1 ................... 101,105 § 2 .............. 102,105,107 § 4, 6.......103,105 Workmen’s Compensation Act............. 284 Kentucky. Stats. §§ 2241, 2248... 614 Louisiana. 1932, Act. No. 6, Reg. Sess., § 1 605, 606, 608, 609, 612 § 2 605-609,612 § 3 605-608,612 New Jersey. 1896 P. L., p. 119. 198 1910 Comp. St., p. 3164, § 3.................. 198 4 Comp. St. 1910, p. 4763, § 1................ 113 Page. New Mexico. 1934 Laws, c. 7, § 201, Spécial Session........251 New York. 1891 Laws, c. 4........... 577 1910 Laws, c. 480......... 580 1919 Laws, c. 408, §§ 60-62, 74............. 495 1934 Laws, c. 873, § 2 576,584 1935 Laws, c. 601......... 576 Local Laws, City of New York, 1925, No. 16........ 581 1934, No. 21, § 1 ..... 576,579 § 2...........575 § 14 .... 576,585 1935, No. 2, § 14 .. 575- 579,585 No. 30, § 2... 575 Partnership Act....... 495 Publie Service Law.... 580 §§ 25, 53, 60, 63, 81, 89, 90, 99 .... 580 Rapid Transit Act.........577 Oklahoma. Constitution, Art. II, § 6.......... 209 Art. VII, §§ 1, 2.. 209 Art. IX, § 18......... 208 § 20 .... 208,211 §§ 22, 23.. 208,209 § 34 ..... 208, 210 Qregon. 1874 Laws, p. 10........... 22 1933 Laws, c. 322 ............ 21 c. 387 .................... 21 c. 31, 2d Spec. Sess.......... 21 1930 Code, §§ 49-1801 to 49-1845 ................. 25 § 60-1302 ................. 22 § 60-1303 ................. 23 §§ 69-1501 to 69-1538, c. XV, Tit. LXIX.... 21 LXIV TABLE OF STATUTES CITED. Page. Pennsylvania. 1935, Act of June 28, P. L. 475, §§ 41, 282, 334 ................... 278 Purdon’s Penn. Stats., Tit. 27, §§ 41, 45, 282, 334 .............. 277 South Carolina. Act No. 259, Apr. 28, 1933, Gen. Assembly, 38 Stat. 340, § 2................ 180 §§ 4, 6................... 181 Act No. 685, 36 Stat. 1192........................ 195 Act No. 721, 33 Stat. 1182........................ 195 Tennessee. Code, § 8769 .............. 246 Page. Texas. Rev. Civil Stats., Art. 6059 ................. 156 Rev. Civil Stats., 1925, Arts. 6058, 6059...... 125 Washington. 1935 Laws, Tit. IV, c. 180.... 17 Tit. XVIII, c. 180, § 199.............. 17 Wisconsin. 1937 Stats., § 103.51.. 340 1937 Stats., c. 103, § 103.53........... 328 § 103.62 ................... 327 Labor Code, 1937.. 329,330 § 103.53.............. 328 § 103.62.................... 327 (C) Treaties 1848, July 4, 9, Stat. 922, Guadalupe Hidalgo...... 504,510 (D) Foreign Statutes English. Wireless Telegraphy Act, 1904, c. 24, 4 Edw. 7; c« 67, 15 & 16 Geo. 5.............................................i... 260 CASES ADJUDGED IN THE SUPREME COURT OF THE UNITED STATES AT OCTOBER TERM, 1937. KAY v. UNITED STATES. CERTIORARI TO THE CIRCUIT COURT OF APPEALS FOR THE SECOND CIRCUIT. No. 61. Argued December 10, 13, 1937.—Decided January 31, 1938. 1. The Court déclinés to consider a point made by the Government, not raised below and not adequately based in the record, to the effect that a défendant whose plea of guilty was withdrawn on motion made after the ten days set by Rule II (4) of the Criminal Appeals Rules and who was tried and convicted, is precluded from attacking the indictment and the statute on which it was founded. P. 4. 2. The second mortgagee of property on which a loan is being sought of the Home Owners’ Loan Corporation, who, in a consent to accept bonds of the Corporation in full settlement of his debt, knowingly and falsely, for the purpose of influencing the action of the Corporation, overstates the amount of his claim, is guilty of a violation of § 8 (a) of the Home Owners’ Loan Act. P. 5. 3. Even if the other parts of the Act were unconstitutional, § 8 (a), aided by the separability clause, is valid as a protection of the Government against false and misleading représentations while the Act is being administered. P. 6. When one undertakes to cheat the Government or to mislead those acting under its authority, by false statements, he has no standing to assert that the operations of the Government in which the effort to cheat or mislead is made are without constitutional sanction. 53383°—38---1 1 2 OCTOBER TERM, 1937. Counsel for Parties. 303 U. S. 4. Sec. 8 (a) of the Home Owners’ Loan Act defines the crime suffi-ciently to comply with due process. P. 7. 5. Sec. 8 (e) of the Home Owners’ Loan Act, originally and as amended in 1934, forbids and penalizes the charging of applicants for loans from the Home Owners’ Loan Corporation for services rendered “for examination and perfection of title, appraisal, and like necessary services,” except the “ordinary charges” or fees authorized and required by the Corporation. Held valid. (1) Sec. 8 (e) is separable from the other provisions of the statute. P. 8. (2) Without regard to the validity of the scheme of the Act, Congress was authorized to protect from exploitation through im-proper or excessive charges those who sought loans under it. Id. (3) Taken in connection with a resolution of the Corporation defining the ordinary charges that are “authorized or required,” and providing for “any other necessary charge for like necessary services, as specifically approved by the Board of Directors,” the section is sufficiently definite to satisfy due process. P. 8. (4) The phrase “like necessary services” means services cognate to those mentioned in the preceding clause, “for examination and perfection of title” and “appraisal.” P. 9. (5) Congress did not exceed its power in delegating to the Corporation the authority to make such régulations. Id. 6. Under the Criminal Appeals Rules, the Circuit Court of Appeals has power, in the exercise of Sound discrétion, to approve a settle-ment and filing of a bill of exceptions which were too late in the District Court, and to pass upon the rulings there disclosed. P. 9. 89 F. (2d) 19, judgment vacated. Oertiorari, 301 U. S. 679, to review a judgment sus-taining convictions and concurrent sentences on various counts charging violation of the Home Owners’ Loan Act. Messrs. Frank R. Serri and W. S. Culbertson for peti-tioner. Assistant Solicitor General Bell, with whom Solicitor General Reed, Assistant Attorney General McMahon, and Messrs. William W. Barron, Horace Russell, E. K. Neumann, and W. Marvin Smith were on the brief, for the United States. KAY v. UNITED STATES. 3 1 Opinion of the Court. Mr. Chief Justice Hughes dèlivered the opinion of the Court. Petitioner was convicted of violations of § 8 (a)1 and (e) 2 of the Home Owners’ Loan Act of 1933. Act of 1 Section 8 (a) of the Home Owners’ Loan Act, 12 U. S. C. 1467 (a), is as follows: "Sec. 8. (a) Whoever makes any statement, knowing it to be false, or whoever willfully overvalues any security, for the purpose of influencing in any way the action of the Home Owners’ Loan Corporation or the Bo^rd or an association upon any application, advance, discount, purchase, or repurchase agreement, or loan, under this Act, or any extension thereof by renewal deferment, or action or otherwise, or the acceptance, release, or substitution of security therefor, shall be punished by a fine of not more than $5,000 or by imprisonment for not more than two years, or both.” aSection 8 (e) of the Act, 12 U. S. C. 1467 (e), as originally enacted by the Act of June 13, 1933, c. 64, 48 Stat. 134, was as follows : "(e) No person, partnership, association, or corporation shall make any charge in connection with a loan by the Corporation or an exchange of bonds or cash advance under this Act except ordinary charges authorized and required by the Corporation for services actually rendered for examination and perfecting of title, appraisal, and like necessary services. Any person, partnership, association, or corporation violating the provisions of this subsection shall, upon conviction thereof, be fined not more than $10,000, or imprisoned not more than five years, or both.” By the Act of April 27, 1934, c. 168, § 12, 48 Stat. 643, 647, § 8 (e) was amended so as to read: "(e) No person, partnership, association, or corporation shall, directly or indirectly, solicit, contract for, charge or receive, or attempt to solicit, contract for, charge or receive any fee, charge, or other considération from any person applying to the Corporation for a loan, whether bond or cash except ordinary fees authorized and required by the Corporation for services actually rendered for examination and perfection of title, appraisal, and like necessary services. Any person, partnership, association, or corporation violating the provisions of this subsection shall, upon conviction thereof, be fined not more than $10,000, or imprisoned not more than five years or both.” 4 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. June 13, 1933, c. 64, 48 Stat. 128, 134, amended by Act of April 27, 1934, c. 168, 48 Stat. 643, 647. 12 U. S. C., § 1467 (a) and (e). The Circuit Court of Appeals sus-tained the conviction, 89 F. (2d) 19, and because of the importance of the questions presented certiorari was granted. 301 U. S. 679. The conviction was upon eight counts of the indict-ment, viz., counts 5 and 15 under § 8 (a) and counts 8, 12, 14, 20, 24 and 25 under § 8 (e). To count 12 peti-tioner had pleaded guilty but later was permitted to withdraw that plea, pleaded not guilty, and went to trial. On count 8, imposition of sentence was suspended and petitioner was placed upon probation. On the re-maining seven counts, petitioner was sentenced to a year and a day in prison, the sentences to run concurrently. The Circuit Court of Appeals refused to consider errors arising on the bill of exceptions, as it had not been settled and filed within the time permitted by Rule IX of the Criminal Appeals Rules. The court accordingly limited its considération to the sufiiciency of the indictment, entertaining and deciding the questions of the consti-tutional validity of the Home Owners’ Loan Act and of the provisions of § 8 (a) and (e) in particular. The Government contends that the convictions should be sustained, irrespective of questions of the validity of any part of the statute, upon the ground that, the sentences being concurrent, the judgment should be af-firmed if good under any one of the counts. In that view, the Government submits that petitioner consented to the judgment on count 12. The point is that petitioner was permitted to withdraw her plea of guilty to that count although eleven days had intervened, while Rule II (4) of the Criminal Appeals Rules requires such a motion to be made within ten days. The Government argues that the provision of the rule is mandatory and hence the judgment, as one upon consent, should be 1 KAY v. UNITED STATES. Opinion of the Court. 5 affirmed without considération of the merits. Petitioner answers that the Government by going to trial is now estopped to raise the question and further that a plea of guilty does not prevent the défendant from challenging the sufficiency of the indictment. (2 Bishop on Crimi-nal Procedure, 2d ed., § 795.) The point does not ap-pear to hâve been raised either in the District Court or in the Court of Appeals and it is based solely upon the dates of certain entries in the criminal docket without any supporting proof. We are not disposed to deal with a question of that importance presented in this manner. First.—As to the counts under § 8 (a).8—Counts 5 and 15, under that provision, charge that petitioner, being the holder of a second mortgage upon certain promises, in executing the consent to accept bonds of the Home Own-ers’ Loan Corporation in full settlement, and for the pur-pose of influencing the action of the Corporation, know-ingly and falsely stated that her daims were respectively in the sums of $590 and $650, whereas in fact they were respectively only in the sums of $285 and $150. Petitioner argues that there is no allégation that a loan to the owner was made or approved, or that any payment was made to petitioner; that the second mortgagee’s consent is temporary and may be withdrawn; that it is not under oath and that there is no warranty of the truth of the information given. Petitioner argues further that any statement in the consent of a second mortgagee as to the balance due cannot endanger or directly influence any loan made by the Corporation; that the second mortgagee is not an applicant and that the practice in such cases négatives reliance on the consent, as the essen-tial factors are the value of the property, as to which the Corporation makes its appraisal, and the eaming ca-pacity of the owner. None of these arguments is im-pressive. It does not lie with one knowingly making 3 See Note 1. 6 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. false statements with intent to mislead the officiais of the Corporation to say that the statements were not influential or the information not important. There can be no question that Congress was entitled to require that the information be given in good faith and not falsely with intent to mislead. Whether or not the Corporation would act favorably on the loan is not a matter which concerns one seeking to deceive by false information. The case is not one of an action for damages but of criminal liability and actual damage is not an ingrédient of the offense. Petitioner’s main argument is that the whole scheme of the statute is invalid; that Congress had no constitu-tional authority to create the Home Owners’ Loan Corporation,—to provide for the conduct of a business enter-prise of that character. There is no occasion to consider this broad question as petitioner is not entitled to raise it. When one undertakes to cheat the Government or to mislead its officers, or those acting under its authority, by false statements, he has no standing to assert that the operations of the Government in which the effort to cheat or mislead is made are without constitutional sanction. We recently dealt with a similar contention that the false daims statute, Criminal Code, § 35, did not apply to a conspiracy to cheat the United States by false représentations in connection with operations under a statute which this Court found to be unconstitutional. We said that such a construction was inadmissible. “It might as well be said that one could embezzle moneys in the United States Treasury with impunity if it turns out that they were collected in the course of invalid transactions. . . . Congress was entitled to protect the Government against those who would swindle it regardless of questions of constitutional authority as to the operations that the Government is conducting. Such questions cannot be raised by those who make false daims 1 KAY v. UNITED STATES. Opinion of the Court. 7 against the Government.” United States v. Kapp, 302 U. S. 214, 217-218; Madden v. United States, 80 F. (2d) 672. While the instant case is not one of conspiracy to obtain money from the United States, but one of false statements designed to mislead those acting under au-thority of the Government, the principle involved is the same. Apart from any question of the validity of the other provisions of the Home Owners’ Loan Act, Con-gress was entitled to secure protection against false and misleading représentations while the Act was being ad-ministered, and the separability provision of the Act (§9) is clearly applicable. Utah Power Co. v. Pjost, 286 U. S. 165, 184. There is the further argument that the provision of § 8 (a), separately considered, offends the due process clause as being vague and uncertain. We find no merit in that contention. The statute defining the crime is sufficiently explicit. Second.—As to the counts under § 8 (e).4—The Government points out that count 14 is based on the statute as it was originally enacted in 1933. That count charges that petitioner on or about April 1, 1934, made a contract with an applicant for a loan for the payment to petitioner of a certain sum for services in connection with the loan and that the contract was not for “an ordinary charge or fee authorized and required by the Home Own-ers’ Loan Corporation for services actually rendered for examination and perfection of title, appraisal, and like necessary services.” Counts 12, 20, 24 and 25, under the statute as amended, charge that petitioner in or about June, July and Sep-tember, 1934, made similar contracts for the payment of unauthorized charges. It appears that the Board of Directors in January, 1934, specifically provided that “the ordinary charges author- 4 See Note 2. 8 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. ized and required” for services should consist of (1) an appraisal fee as approved by the Board, (2) a fee for a character report, (3) necessary recording and similar fees, (4) necessary charges for perfecting title in a sum not exceeding $75 in any case and larger necessary charges if approved by the Board, (5) necessary and usual fees for abstracts, examination of title, opinions, certificates of title or title Insurance, (6) charges of attorneys or title companies for escrow services or closing loans, and (7) any other necessary charge for like necessary services as specifically approved by the Board. Section 8 (e) is also separable from the other provisions of the statute. It is plainly designed to prevent the exploitation of applicants. It rests upon the same prin-ciple as that which underlies § 8 (a) as to false and mis-leading représentations to the officiais of the Corporation. Congress was entitled not only to prevent misap-plication of the public funds and to protect the officiais concerned from being misled, but also to protect those who sought loans from being imposed upon by extravagant or improper charges for services in connection with their applications. This would be in the interest “not only of themselves and their families but of the public.” See Yeiser v. Dysart, 267 U. S. 540, 541; Nebbia v. New York, 291 U. S. 502, 535, 536. Authority to penalize such exploitation while the enterprise is being conducted can-nqt be regarded as dépendent upon the validity of the general plan. That plan might or might not be assailed. If assailed, a long period might elapse before final decision. Meanwhile, the governmental operations go on, and public funds and public transactions require the protection which it was the aim of these penal provisions to secure, whatever might be the ultimate détermination as to the validity of the enterprise. United States v. Kapp, supra. As a separable provision, the validity of § 8 (e) is challenged as lacking the requisite definiteness under the 1 KAY v. UNITED STATES. Opinion of the Court. 9 due process clause. Section 8 (e) as amended in 1934 omitted the words “in connection with a loan by the Corporation or an exchange of bonds or cash advance under this Act” which were in the original provision. But the context, in the amended section, sufficiently shows that the forbidden charges are those in connection with applications “for a loan, whether bond or cash.” The resolution adopted by the Board of Directors sets forth the nature of the ordinary charges that “are authorized and required,” and the power of Congress to provide for such action by the Board is not open to question. See United States v. Grimaud, 220 U. S. 506, 521 ; United States v. Shreveport Grain Co., 287 U. S. 77, 85. The phrase “like necessary services” in the section describes services which are cognate to those mentioned in the preceding clause “for examination and perfection of title” and “appraisal.” And the resolution of the Board, after stating the categories of authorized charges, provides for “any other necessary charge for like necessary services, as specifi-cally approved by the Board of Directors.” We think that the statute sets up an ascertainable standard and is “sufficiently explicit to inform those who are subject to it what conduct on their part will render them fiable to its penalties.” United States ex rel. Handler N. Hill, 90 F. (2d) 573, 574. Compare Connally v. General Construc* tion Co., 269 U. S. 385, 391 ; Old Dearborn Co. v. Seagram-Distillers Corp., 299 U. S. 183, 196. Third.—We hâve considered the objections to the in-dictment which were open in the absence of a bill of exceptions. The Circuit Court of Appeals rightly held that the bill of exceptions was not settled and filed in time under the rule. But its decision was rendered before our decision in Ray v. United States, 301 U. S. 158, con-struing Rule IV of the Criminal Appeals Rules. See, also, Forte v. United States, 302 U. S; 220. That rule gives to the Circuit Court of Appeals full supervision and con-trol of the proceedings on appeal, “including the proceed- 10 OCTOBER TERM, 1937. Syllabus. 303 U. S. ings relating to the préparation of the record on appeal.” The appellate court, in the exercise of its sound discrétion, has authority to provide for the correction of any miscar-riage of justice in connection with any action of the trial judge relating to the settlement and filing of a bill of exceptions. As the Circuit Court of Appeals may hâve proceeded in this case upon the assumption that it had no power to approve the settlement and filing of the bill of exceptions and to pass upon the rulings it disclosed, its judg-ment will be vacated and the cause will be remanded so that the appellate court may be free to exercise its discrétion in that relation. Judgment vacated. Mr. Justice Cardozo took no part in the considération and decision of this case. 4 BRADY v. TERMINAL RAILROAD ASSOCIATION. CERTIORARI TO THE SUPREME COURT OF MISSOURI. No. 163. Argued January 4, 5, 1938.—Decided January 31, 1938. The défendant carrier hauled a string of freight cars over its own line and left them on the receiving track of a connecting carrier, where they then stood temporarily whilst being inspected by an employée of the connecting carrier to détermine whether they should be accepted by the latter for further transportation. Due to a defectively attached grab-iron, the employée fell from one of the cars and was injured. Both carriers were engaged in Interstate commerce. Held that the défendant carrier was liable under the Fédéral Safety Appliance Act. 1. The defective car was “in use,” within the meaning of the statute. P. 13. 2. The responsibility of the défendant carrier, which had brought the car, was not ended, since the other carrier had not accepted it nor assumed control. eP. 13. 3. The duty of the défendant carrier under the Act extended to the person injured, although he was not its employée. P. 14. BRADY v. TERMINAL R. R. ASSN. 11 10 Opinion of the Court. 4. A railroad employée is not denied the protection of the Act because his work is that of inspection for the purpose of discover-ing defects, including defects in the appliances prescribed. P. 14. The duty imposed is absolute and the Act expressly excludes the defense of assumption of risk. 340 Mo. 841; 102 S. W. (2d) 903, reversed. Certiorari, 302 U. S. 678, to review the reversai of a judgment recovered by the présent petitioner in an action for personal injuries. Mr. Mark D. Eagleton, with whom Messrs. Merritt U. Hayden and Roberts P. Elam were on the brief, for petitioner. Mr. Walter N. Davis, with whom Messrs. Thomas M. Pierce and Joseph L. Howell were on the brief, for re-spondent. Mr. Chief Justice Hughes delivered the opinion of the Court. The Suprême Court of Missouri reversed a judgment which petitioner had recovered under the Fédéral Safety Appliance Act, 340 Mo. 841; 102 S. W. (2d) 903, and rendered a final judgment in favor of respondent. See State v. Ragland, 339 Mo. 452, 456, 458; 97 S. W. (2d) 113. In view of the importance of the question in the administration of the fédéral statute, this Court granted certiorari. Petitioner was employed by the Wabash Railway Company as a car inspector in its yard at Granité City, Illinois. He was injured in November, 1927, while inspect-ing a car which was one of a string of cars brought by the respondent, Terminal Railroad Association of St. Louis, from St. Louis to Granité City and placed upon a track of the Wabash known as a “receiving” or “inbound” track. The purpose of the. inspection was to détermine whether the cars were to be accepted by the Wabash. 12 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. Both the Wabash and the Terminal companies were carriers engaged in interstate commerce. While making his inspection petitioner stood upon one of the side ladders of the car, and, in attempting to pull himself to the top of the car, petitioner took hold of a grabiron which, with the board to which it was attached, became loose, causing him to fall. The board was found to hâve “become rotten from end to end on the under side, and to some extent on the upper side around the bolts by which the grabiron was attached to it.” Petitioner first sued his employer, the Wabash, under the provisions of the Fédéral Safety Appliance Act, but a judgment in his favor was reversed upon the ground that the car had not yet been accepted by the Wabash Company which therefore had not hauled or used it, or permitted it to be hauled or used, within the prohibition of the statute. Brady v. Wabash Ry. Co., 329 Mo. 1123; 49 S. W. (2d) 24. While that suit was pending, petitioner brought the présent suit against respondent. The fédéral statute, Act of April 14, 1910, c. 160, § 2, 36 Stat. 298, 45 U. S. C. 11, provides that “it shall be unlawful for any common carrier subject to the provisions of this Act to haul, or permit to be hauled or used on its line any car subject to the provisions of this Act not equipped with appliances provided for in this Act, to wit: Ail cars must be equipped with secure sill steps and efficient hand brakes; ail cars requiring secure ladders and secure running boards shall be equipped with such ladders and running boards, and ail cars hav-ing ladders shall also be equipped with secure hand holds or grab irons on their roofs at the tops of such ladders:” The Act of 1910 supplemented the provisions of the Act of March 2, 1893, c. 196, 27 Stat. 532, 45 U. S. C. 7, which provided in § 8 : “Any employée of any common carrier engaged in interstate commerce by railroad who may be injured by any locomotive, car, or train in use contrary to the provision 10 BRADY v. TERMINAL R. R. ASSN. Opinion of the Court. 13 of this chapter shall not be deemed thereby to hâve as-sumed the risk thereby occasioned, although continuing in the employment of such carrier after the unlawful use of such locomotive, car, or train had been brought to his knowledge.” See, also, Fédéral Employers’ Liability Act, 35 Stat. 65, c. 149, § 4, 45 U. S. C. 54. “ The first question is whether the car can be said to hâve been in use by the respondent at the time in question. The statute gives no ground for holding that it was the întent of Congress that in a situation such as is here pre-sented neither the Wabash nor the Terminal Association should be subject to the statutory duty. The “use, move-ment or hauling of the defective car,” within the meaning of the statute, had not ended when petitioner sustained his injuries. 'Chicago Great Western R. Co. v. Schendel, 267 U. S. 287, 291, 292. The car had been brought into the yard at Granité City and placed on a receiving track temporarily pending the continuance of transportation. If not found to be defective, it would proceed to destination; if found defective, it would be subject to removal for repairs. It is not a case where a defective car has reached a place of repair. See Baltimore & Ohio R. Co. v. Hooven, 297 Fed. 919, 921, 923; New York, C. & St. L. R. Co. v. Kelly, 70 F. (2d) 548, 551. The car in this instance had not been withdrawn from use. Johnson v. Southern Pacific Co., 196 U. S. 1, 21, 22; Delk v. St. Louis & San Francisco R. Co., 220 U. S. 580, 584-586; Great Northern Railway Co. v. Otos, 239 U. S. 349, 351 ; Chicago Great Western R. Co. v. Schendel, supra. The car was still in use, though motionless. Minneapolis, St. P. & S. S. M. Ry. Co. v. Goneau, 269 U. S. 406. In view of that use, either the Terminal Association or the Wabash was subject to the obligation imposed by the statute. The question then is whether the responsibility of the Terminal Association, which brought in the car, had ended. We think that question is answered by the un- 14 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. disputed fact that it was placed by the Terminal Association on the receiving track to await inspection and acceptance by the Wabash. The Wabash had not accepted it. The jury, which found for petitioner, were instructed that as a condition of that verdict it was necessary for them to find that petitioner “was required to go upon said car for the pur-pose of inspecting the equipment thereon and of accept-ing or rejecting said car on behalf of his employer, the Wabash Railway Company.” We cannot agréé with the view, expressed in the opinion of the State court in re-versing the judgment, that “granted that the cars were still (in the legal sense) in the possession of the Terminal,” it might still be held that “the right of control” had passed to the Wabash. As the Wabash had not accepted the car, the Wabash had not assumed control and petitioner was examining the car in order to détermine whether the Wabash should assume control. As the car had not been withdrawn from use and was still in the possession of the Terminal Association, its statutory obligation continued and the question is whether that duty was owing to petitioner. The fact that petitioner was not an employée of the Terminal Association did not necessarily absolve it from duty to him. We hâve said that “the nature of the duty imposed by the statute and the benefits resulting from its performance” usually détermine what persons are entitled to invoke its protection. It was in this view that we held that the power brakes required by the Safety Appli-ance Act were not only for the safety of railway employées and passengers on trains but also of travelers on the highways at railway crossings. Fairport R. Co. v. Meredith, 292 U. S. 589, 596, 597. In the instant case, petitioner in the course of his duty would hâve occasion to go upon the car and use the grabiron, and accordingly the benefit of the statute would extend to him, although 10 BRADY v. TERMINAL R. R. ASSN. Opinion of the Court. 15 he was not employed by the carrier holding the car in use, unless he was outside the scope of the statute be-cause of the spécial character of his work. His work was that of inspection to discover defects of the sort here found to exist as well as others. This final question must be determined in the light of the nature of the obligation resting upon the carrier in relation to the use of a defective car. The statutory lia-bility is not based upon the carrier’s négligence. The duty imposed is an absolute one and the carrier is not excused by any showing of care however assiduous. St. Louis, I. M. & S. Ry. Co. N. Taylor, 210 U. S. 281,295 ; Chicago, B. & Q. Ry. Co. v. United States, 220 U. S. 559, 570; Louisville & Nashville R. Co. v. Layton, 243 U. S. 617, 620, 621; Great Northern Ry. Co. v. Otos, supra. The breadth of the statutory requirements is shown by the fact that it embraces ail locomotives, cars and similar vehicles used on any railway that is a highway of Interstate commerce and is not confined exclusively to vehicles engaged in such commerce. Southern Ry. Co. v. United States, 222 U. S. 20. Laying down this comprehensive rule as a matter of public policy, Congress has made no exception of those employed in inspecting cars. The statute has been liberally construed “so as to give a right of recovery for every in jury the proximate cause of which was a fail-ure to comply with a requirement of the Act.” Swinson v. Chicago, St. P., M. & O. Ry. Co., 294 U. S. 529, 531. In Davis v. Wolfe, 263 U. S. 239, 243, reviewing the earlier cases, the Court held that one can recover “if the failure to comply with the requirements of the act is a proximate cause ôf the accident, resulting in in jury to him while in the discharge of his duty, although not engaged in an operation in which the safety appliances are specifically designed to furnish him protection.” Even where the required equipment is known to hâve become defective and the car is being hauled to the nearest avail- 16 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. able point for repairs, while the Act relieves the carrier in such a case from the prescribed penalties, the carrier still remains subject by the express ternis of the statute to civil liability for injuries sustained by “any railroad employée” in the course of such a movement by reason of the defective equipment. Act of April 14, 1910, c. 160, § 4, 36 Stat. 299; 45 U. S. C. 13. See New York, C. & St. L. R. Co. v. Kelly, supra. We think that these considérations require the conclusion that one is not to be denied the benefit of the Act because his work was that of inspection for the pur-pose of discovering defects. As we said in Louisville & Nashville R. Co. v. Layton, supra, the liability “springs from its being made unlawful to use cars not equipped as required,—not from the position the employée may be in or the work which he may be doing at the moment when he is injured,” provided the defective equipment is the proximate cause of the injury. The fact that petitioner was looking for defects of the sort which caused his injury does not prevent recovery as the statute expressly excludes the defense of assump-tion of risk. 45 U. S. C. 7, 54. The judgment is reversed and thè cause is remanded for further proceedings not inconsistent with this opinion. Reversed. Mr. Justice Cardozo took no part in the considéra tion and decision of this case. HENNEFORD v. NOR. PACIFIC RY. Opinion of the Court. 17 HENNEFORD et al. v. NORTHERN PACIFIC RAILWAY CO. APPEAL FROM THE DISTRICT COURT OF THE UNITED STATES FOR THE EASTERN DISTRICT OF WASHINGTON. No. 243. Argued January 11, 1938.—Decided January 31, 1938. Upon appeal from a decree of the District Court enjoining the en-forcement of a state tax, the amount of which, as alleged in the bill, was less than $3,000, héld: 1. That the District Court had no jurisdiction notwithstand-ing other allégations to the effect that failure to pay would entail much greater damage to the plaintiff by way of penalties, seizure and sale of property and damage to business. Healy v. Ratta, 292 U. S. 263, 268. P. 19. 2. A motion for leave to file an affidavit to supplément the record for the purpose of showing the amount of the tax for suc-ceeding months must be denied. Id. 3. The case should be decided upon the record before this Court; the jurisdiction of the District Court should be tested by the case made by the bill; and that court should be directed to dismiss for want of jurisdiction. Id. 15 F. Supp. 302, reversed. Mr. R. G. Sharpe, Assistant Attorney General, with whom Mr. G. W. Hamilton, Attorney General, of the State of Washington, was on the brief, for appellants. Mr. M. L. Countryman, Jr., with whom Mr. Lorenzo B. daPonte was on the brief, for appellee. By leave of Court, Messrs. Robert Brennan, Léo E. Sievert, and Harry H. McElroy filed a brief on behalf of the Atchison, Topeka & Santa Fe Ry. Co. et al., as amici curiae, in support of appellee. Per Curiam. This suit was brought to restrain the enforcement against the Northern Pacific Railway Company of the “compensating tax” imposed by Title IV of Chapter 180 53383°—38-------2 18 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. of the Laws of Washington of 1935. The Act levies a tax of 2% for the privilège of using within the State any article of tangible personal property purchased subséquent to April 30, 1935. Cf. Henneford v. Silos Mason Co., 300 U. S. 577. The bill alleged that in the necessary maintenance, operation and repair of its railroad, the Company purchases materials, supplies, shop machinery and tools, a part of which are bought in other States and transported into the State of Washington, and that such purchases in other States in May and June, 1935, as shown by the list annexed to the complaint and made a part of it, amounted to $102,204.18, including the cost of transportation. The bill also alleged that the défendants (appel-lants here) composing the State Tax Commission of the State of Washington had demanded the tax of 2% of this sum and unless enjoined would assess penalties on the tax amounting to $2,044.08, and would cause summary process to be issued for the seizure and sale of the Com-pany’s property and that its business would thereby be interfered with to its irréparable damage in the sum of more than $100,000, and that the Company was without an adéquate remedy at law. The validity of the tax was assailed under the commerce and due process clauses of the Fédéral Constitution. An interlocutory injunction was sought and the case was heard in the District Court by three judges. 28 U. S. C. 380. It was stipulated that the case be submitted for final détermination on its mérita and decree was entered permanently enjoining the enforce-ment of the tax. 15 F. Supp. 302. The case cornes here on appeal. By its order of October 11, 1937, this Court noted probable jurisdiction and directed the attention of counsel to the questions as to (1) the existence of the required jurisdictional amount and (2) the adequacy of the remedy at law. Appellants concédé that in view of the terms of the statute prohibiting any action to recover the tax, 17 HENNEFORD v. NOR. PACIFIC RY. Opinion of the Court. 19 if paid, excep t as therein provided (Laws of Washington, 1935, c. 180, Title XVIII, § 199) there would be no rem-edy available at law in the fédéral court and hence that fédéral equity jurisdiction would not be ousted. City Bank Co. v. Schnader, 291 U. S. 24, 29. With respect to the jurisdictional amount, it appears on the face of the complaint that the tax, the enforcement of which is sought to be enjoined, amounted only to $2,044.08 and that the damages alleged would be incurred only by failure to make the required payment. It follows that the requisite jurisdictional amount is not involved. See Healy v. Ratta, 292 U. S. 263, 268, and cases there cited. Appellee moves for leave to file an affidavit to supplément the record for the purpose of showing the amount of the tax for succeeding months. The motion is denied. The Court is of the opinion that the case should be de-cided upon the record before it and that the jurisdiction of the District Court should be tested by the case made by the bill of complaint. The judgment is reversed and the cause is remanded to the District Court with directions to dismiss the bill for want of jurisdiction. Reversed. Mr. Justice Cardozo took no part in the considération and decision of this case. 20 OCTOBER TERM, 1937. Counsel for Parties. 303 U. S. ATKINSON et al. v. STATE TAX COMMISSION OF OREGON et al. APPEAL FROM THE SUPREME COURT OF OREGON. No. 303. Argued January 13, 1938.—Decided January 31, 1938. Oregon applied its personal income tax law to the net income derived by individuals from their work, within the boundaries of the State, in the construction of the Bonneville Dam on the Columbia River, a navigable stream, under a contract with the United States. The work was performed partly in the bed of the river and partly on other land purchased by the United States. Held valid. 1. The tax did not burden the operations of the Fédéral Government. P. 21. 2. Subject to the paramount authority of the Fédéral Government to hâve the work performed for purposes within the fédéral province, the State retained its title and territorial juris-diction over the river bed. P. 22. 3. With like restriction, the State retained its territorial juris-diction over the land purchased, notwithstanding a general law of Oregon consenting to purchase of land by the United States for the érection of “any needful buildings” and purporting to cede exclusive jurisdiction over the same; since the Fédéral Government need not accept such jurisdiction when tendered and in this instance the facts show that it intended otherwise. P. 23. 4. The tax involved no interférence with the carrying out of the fédéral project. P. 25. 156 Ore. 461; 67 P. (2d) 161, affirmed. Appeal from a judgment of the Suprême Court of Oregon sustaining a tax. Mr. Howard P. Amest for appellants. Mr. Cari E. Davidson, Assistant Attorney General, with whom Mr. I. H. Van Winkel, Attorney General, of Oregon, was on the brief, for appellees. ATKINSON v. TAX COMM’N. 21 20 Opinion of the Court. By leave of Court, A ttorney General Cummings, So-licitor General Reed, Assistant Attorney General Morris, and Messrs. Sewall Key and Arnold Raum filed a brief on behalf of the United States, as amicus curiae, in support of appellees. Per Curiam. This case présents the question of the validity of the Personal income tax law of Oregon (Oregon Code 1930, c. XV, Title LXIX, §§ 60-1501 to 69-1538, as amended by Laws of 1933, c. 322 and 387 and by laws of 1933, Second Spécial Session, c. 31) as applied to the net income of the appellants derived from their work within the ex-terior limits of the State in the construction of the Bonneville Dam on the Columbia River under a contract with the United States. The contract was made in Feb-ruary, 1934, and the work was completed in that year. The tax was assailed upon the grounds (1) that it bur-dened the operations of the Fédéral Government and (2) that the area within which the work was done was within the exclusive jurisdiction of the United States. The Suprême Court of the State sustained the tax, 156 Ore. 461 ; 62 P. (2d) 13, 67 P. (2d) 161, and the contractors appeal. With respect to the contention that the state law lays an unconstitutional burden upon the Fédéral Government, the case is controlled by our previous decisions. Metcalf & Eddy v. Mitchell, 269 U. S. 514; General Construction Co. v. Fisher, 295 U. S. 715; James v. Dravo Contracting Co., 302 U. S. 134; Silos Mason Co. n. Tax Commission, 302 U. S. 186. In the two cases last men-tioned the tax which was upheld was upon the gross income of the contractors. In Metcalj & Eddy n. Mitchell, supra, and General Construction Co. v. Fisher, supra, the tax was upon the net income. As to territorial jurisdiction, it appears that the area within the boundaries of Oregon in which the work was 22 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. performed embraced (a) the bed of the Columbia River, where the main structural works are placed, and (b) Bradford island and a portion of the mainland. The United States did not acquire title to the bed of the river. Upon this point the State court said (pp. 481-482): “Section 60-1302, Oregon Code 1930 (Laws 1874, p. 10), grants to the governor of Oregon authority and power to convey to the United States title to land belong-ing to the state and covered by the waters of the United States, not exceeding ten acres in any one tract, as the site of a lighthouse, beacon or other aid to navigation, upon application made to him by a duly authorized agent of the United States, and further grants him authority ‘to cede to the said United States jurisdiction over the sanie,’ reserving, however, to the state the right to serve thereon civil or criminal process issuing under authority of the state. No application has been made to the gov-emor of this state or to the législature for conveyance of any part of the bed of either the north or south chan-nel of the Columbia river within the project, or for cession to the fédéral govemment of jurisdiction over the same. . . . “No authority has been called to our attention to the effect that the state of Oregon has in any way relinquished its sovereignty over the area occupied by the waters of Bradford slough and that part of the north channel of the Columbia river which is within the territorial limits of the state.” The case in this relation falls within the principle of our decision in James v. Dravo Contracting Co., supra. The question, we there said, was not one of the paramount authority of the Fédéral Government to hâve the work performed for purposes within the fédéral province. The title to the bed of the river was in the State. And, although subject to the dominant right of the Fédéral 20 ATKINSON v. TAX COMM’N. Opinion of the Court. 23 Government, the servient title continuée! in the State which thus retained its territorial jurisdiction for pur-poses not inconsistent with the exercise by the Fédéral Government of its constitutional fonctions. See, also, Silos Mason Co. v. Tax Commission, supra. The remaining question concerns the lands on Bradford island and the mainland which were purchased by the United States. Appellants rely upon the Oregon statute giving consent to the United States to purchase or other-wise acquire any land within the State “for the purpose of erecting thereon any needful public buildings” under authority of any act of Congress, and providing that the United States should hâve “the right of exclusive jurisdiction over the same,” saving the authority of the State for the service of process. Oregon Code, 1930, § 60-1303. In Silos Mason Co. v. Tax Commission, supra, we said that as a transfer of exclusive jurisdiction rests upon a grant by the State, it follows, in accordance with familiar principles applicable to grants, that the grant may be ac-cepted or declined. Acceptance may be presumed in the absence of evidence of a contrary intent. But we found no constitutional principle “which compels acceptance by the United States of an exclusive jurisdiction contrary to its own conception of its interests.” The mere fact that the Government needs title to property within the boundaries of a State “does not necessitate the assumption by the Government of the burdens incident to an exclusive jurisdiction.” In this instance, the state court took the view that the Fédéral Government had not accepted and did not in-tend to exercise exclusive legislative authority over the lands which had been purchased for this project. The court said : “The mere fact that there may be on the statute books of the state a general law, such as § 60-1303, Oregon Code 1930, consenting to the purchase of land by the 24 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. United States and granting to the national government the right to exercise exclusive jurisdiction thereover, does not imply that over ail lands purchased by the national government in the State after the enactment of such law the state is divested ipso facto of sovereignty, and exclusive control over the acquired area is assumed by the fédéral government. In the instant case there is nothing to indicate that the fédéral government desires to exercise exclusive legislative jurisdiction over the land purchased by it within the Bonneville project. It would be some-what inconsistent to assume that since it does not hâve such jurisdiction over the major part of the structures which • are now being built, the fédéral government is seeking to exercise exclusive jurisdiction over that part of the works located on lands title to which it has acquired. “The record discloses that the government officiais in charge of the construction work required the contractors to corne under the provisions of the workmen’s compensation law of the state in which the work was to be per-formed. At the time the contract with the plaintiffs was entered into at least two States had held that their workmen’s compensation laws were not effective on territory over which the fédéral government had exclusive jurisdiction: Willis v. Oscar Daniels Co., 200 Mich. 30 (166 N. W. 496) ; Murray v. Joe Gerrick & Co., 172 Wash. 365 (20 P. (2d) 591). On February 5, 1934, the Suprême Court of the United States affirmed the latter case. See 291 U. S. 315. “The contract between the plaintiffs and the fédéral government was dated February 6, 1934. In view of those decisions it is reasonable to assume that the officiais in charge of construction of the Bonneville dam on behalf of the fédéral government understood that the land in-cluded in the project was not under the exclusive legislative jurisdiction of the United States. Otherwise they 20 ATKINSON v. TAX COMM’N. Opinion of the Court. 25 would not hâve required contractors to provide state workmen’s compensation.” The contract between the Government and appellants is not in evidence but the record discloses, as stated by the state court, that the Government did not seek to exclude the State from ail legislative authority, an exclusion which would hâve followed from an acceptance of a grant of “exclusive jurisdiction” with the sole réservation of the right to serve process. The enforcement and administration of the Oregon compensation law (see Oregon Code 1930, §§ 49-1801 to 49-1845), with which the contractors were required to comply} were incompatible with the existence of exclusive legislative authority in the United States.1 If, however, exclusive jurisdiction, although offered, was not accepted by the United States, there is no warrant for the conclusion that the State did not retain its territorial jurisdiction over the area in question so far as its exercise involved no interférence with the carrying out of the fédéral project. And as we hâve decided that there is no such interférence through the enforcement of a tax such as is here assailed, we find no ground for overruling the decision of the state court. The judgment is Affirmed. Mr. Justice Cardozo took no part in the considération and decision of this case. xThe purchases of the lands, here involved, were made by the Government, and the contract with the appellants was made and performed, prior to the enactment of the Act of Congress of June 25, 1936, 49 Stat. 1938, and we express no opinion as to the effect of that Act in relation to lands as to which exclusive jurisdiction had previously been granted to and accepted by the United States. 26 OCTOBER TERM, 1937. Counsel for Parties. 303 U. S. UNITED STATES v. ESNAULT-PELTERIE. CERTIORARI TO THE COURT OF CLAIMS. No. 231. Argued January 7, 1938.—Decided January 31, 1938. 1. Review by this Court of a judgment of the Court of Claims against the United States in a suit for infringement of a patent, brought under the Act of June 25, 1910, as amended, is limited to questions of law. P. 28. 2. In a patent case in the Court of Claims under the Act of 1910 the questions of validity and infringement are questions of fact. P. 29. 3. The duty of the Court of Claims to find the ultimate facts, re-quires that it résolve conflicting inferences and draw the necessary factual conclusions from the evidence. Id. 4. The Court of Claims made elaborate circumstantial findings pre-ceding its two ultimate findings that the patent sued on was valid and infringed by the United States. Its opinion disclosed that there was contradictory testimony by experts for the claimant and for the United States, but the evidence was not, and could not properly be, incorporated in the record before this Court. Held that while this Court could inquire whether the ultimate findings were necessarily overborne by the subordinate ones, thus show-ing that the judgment against the United States was not sus-tainable in point of law, it could not take up the patents set forth in the findings and, in the absence of the explanatory and con-struing testimony of the expert witnesses, attempt to pass upon the varions questions involved, and upon such a necessarily limited considération overrule the conclusions of fact reached by the Court of Claims upon the entire record. P. 30. 84 Ct. Cls. 625, affirmed. Certiorari, 302 U. S. 668, to review a judgment against the United States on a claim of patent infringement. See s. c. 299 U. S. 201. Mr. Drury W. Cooper, with whom Soliciter General Reed, Assistant Attorney General Whitaker, and Messrs. Alexander Holtzoff and Lee A. Jackson were on the brief, for the United States. 26 U. S. v. ESNAULT-PELTERIE. Opinion of the Court. 27 Messrs. George T. Bean and Eugene V. Myers, with whom Messrs. R. Keith Kane and Edwin J. Brindle. were on the brief, for respondent. Per Curiam. Respondent brought this suit to recover compensation for the use and manufacture by and for the United States of a device alleged to be covered by respondent’s patent No. 1,115,795 for an invention for the control of the equilibrium of airplanes. On the first hearing, the Court of Claims made spécial findings of fact and decided as a conclusion of law that respondent’s patent was valid and had been infringed by the United States and that respondent was entitled to compensation. Judgment was entered accordingly. 81 Ct. Cls. 785. On review by writ of cer-tiorari, this Court held that validity and infringement were ultimate facts to be found by the Court of Claims and, as these facts had not been found, the judgment was vacated and the case was remanded to that court with instructions to find specifically whether respondent’s patent was valid and, if so, whether it had been infringed. United States v. Esnault-Pelterie, 299 U. S. 201. The parties then moved in the Court of Claims for ad-ditional findings and that court amended its spécial findings by adding the following findings of fact : “XLVIII. Claims 2, 5, 6, 7, 8, and 9 of the Esnault-Pelterie patent in suit are valid. “XLIX. The three alleged infringing airplanes of the défendant ail possess the single vertical lever movable in every direction for controlling the latéral or longitudinal equilibrium of the airplane, connected to équivalent controlling surfaces having the same functional effects as those disclosed in the patent. “Claims 2, 5, 6, 7, 8, and 9 of the Esnault-Pelterie patent in suit are infringed by défendant.” 28 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. The court then entered an interlocutory judgment holding respondent entitled to compensation and directing that the court’s previous findings, as amended, together with its opinion as theretofore announced, should stand. 84 Ct. Cls. 625. Certiorari was granted. Without its consent, the United States may not be sued for infringement of a patent. Crozier v. Krupp, 224 U. S. 290. The Congress has determined the conditions upon which the United States consents to be sued. By the applicable statute Congress has permitted suit to be brought in the Court of Claims for reasonable compensation for the infringing use or manufacture. Act of June 25, 1910, 36 Stat. 251, as amended by Act of July 1, 1918, 40 Stat. 705. 35 U. S. C. 68. Review by this Court of the judgment in such a suit is thus subject to the rules which hâve been established for the review of the judg-ments of the Court of Claims. That review is limited to questions of law. The Act of March 3, 1863, c. 92, 12 Stat. 765, providing for suits against the United States in the Court of Claims, authorized appeals to this Court under such régulations as this Court should direct. See, also, Act of March 3, 1887, c. 359, § 4, 24 Stat. 505, 506. 28 U. S. C. 761. The rules first adopted provided for the finding of the facts by the Court of Claims and directed that “The facts so found are to be the ultimate facts or propositions which the evidence shall establish, in the nature of a spécial verdict, and not the evidence on which the ultimate facts are founded.” Rule 1, 3 Wall. vit. The présent rule, under § 3 (b) of the Act of February 13, 1925, c. 229, 43 Stat. 936, governing review upon certiorari, is to the same effect. Rule 41, par. 3. This established practice was thus described in Luckenbach S. S. Co. v. United States, 272 U. S. 533, 538, 539: “This Court uniformly has regarded the législation and rules as confining the review to questions of law shown by U. S. v. ESNAULT-PELTERIE. 29 26 Opinion of the Court. the record when made up as the rules direct. Bills of exception are not recognized in either the législation or the rules; nor is there other provision for bringing the evidence into the record or including therein the various rulings involved in applying to the evidence presented the rules which mark the line between what properly may be considered and what must be rejected. As long ago as Mahan v. United States, 14 Wall. 109, 111, this Court said of the rules that they could not be examined ‘without seeing that the purpose was to bring nothing here for review but questions of law, leaving the Court of Claims to exercise the functions of a jury in finding facts, équivalent to a spécial verdict and with like effect.’ ”1 In a patent case in the Court of Claims under the Act of 1910 the questions of validity and infringement are questions of fact. We hâve said that, for the purposes of our review in such a case, the findings of the Court of Claims “are to be treated like the verdict of a jury, and we are not at liberty to refer to the evidence, any more than to the opinion, for the purpose of eking out, controlling, or modifying their scope.” Brothers v. United States, 250 U. S. 88, 93; Stïlz v. United States, 269 U. S. 144, 147, 148; United States v. Esnault-Pelterie, supra. The re-quirement that the Court of Claims should find the ulti-mate facts which are controlling places upon that court the duty of resolving conflicting inferences and to draw from the evidence the necessary conclusions of fact. United States v. Adams, 6 Wall. 101, 112. Even though the finding détermines a mixed question of law and fact, the finding is conclusive unless the court is able “to so separate the question as to see clearly what and where the mistake of law is.” Ross v. Day, 232 U. S. 110, 117; 1 See, also, United States v. Smith, 94 U. S. 214; Stone v. United States, 164 U. S. 380, 383; Collier v. United States, 173 U. S. 79; Crocker v. United States, 240 U. S. 74; Niles Bernent Pond Co. v. United States, 281 U. S. 357, 360. 30 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. United States v. Omaha Indians, 253 U. S. 275, 281; Stilz v. United States, supra; United States v. Swift & Co., 270 U. S. 124, 138. In the instant case, as pointed out in our previous opinion, there are 47 findings of fact preceding the find-ings of the ultimate facts, as now made, and by reference there are included 28 exhibits on 266 pages. These référencés cover a number of patents claimed to be in an-alogous arts. From these, the Government seeks to es-tablish that the device in question was not patentable over prior disclosures. But this is not a case where the Court of Claims has presented in its findings ail the évidence upon which the ultimate facts are based so that it appears on the face of the findings that the judgment is necessarily wrong as matter of law. United States v. Clark, 96 U. S. 37, 40. Cf. United States v. Berdan Fire-Arms Co., 156 U. S. 552, 573; Stone v. United States, 164 U. S. 380, 383. The opinion of the Court of Claims con-tains an elaborate review of the patents to which refer-ence is made, and it discloses that there was “considérable contradictory testimony” by the various experts for the plaintiff and the défendant. That testimony is not hère, and would not appropriately form part of the record brought to this Court, as it was the duty of the court be-low, and is not ours, to deal with the conflicts of state-ment or inferences to which it might give rise. We are not unmindful of the rule that where, with ail the évidence before the court, it appears that no substantial dispute of fact is presented, and that the case may be de-termined by a mere comparison of structures and extrinsic evidence is not needed for purposes of explanation, or évaluation of prior art, or to résolve questions of the application of descriptions to subject-matter, the questions of invention and infringement may be determined as questions of law. Heald v. Rice, 104 U. S. 737, 749; Singer Mfg. Co. v. Cramer, 192 U. S. 265, 275; Sanitary U. S. v. ESNAULT-PELTERIE. 31 26 Opinion of the Court. Rejrigerator Co. v. Winter s, 280 U. S. 30, 36. But we do not think that rule is applicable where we are unable to examine the testimony which was heard by the court be-low and we cannot say that it was of no importance or détermine its value in the light of the disputes revealed. We should not be justified in taking up the patents set forth in the findings and, in the absence of the explana-tory and construing testimony of the expert witnesses with respect to the pertinent fact situations, in attempt-ing to pass upon the varions questions, whether of a scien-tific nature or otherwise, that are involved and upon such a necessarily limited considération in overruling the conclusions of fact reached by the Court of Claims upon the entire record. Cf. Bischoffv. Wethered, 9 Wall. 812, 815, 816; Royer v. Schultz Belting Co., 135 U. S. 319, 325; St. Paul Plow Works v. Starling, 140 U. S. 184, 196, 197; Coupe v. Royer, 155 U. S. 565, 577-580. We may, of course, inquire whether the subordinate or circumstantial findings made by the court below necessarily override its ultimate findings of fact and show that the judgment in point of law is not sustainable. But we hâve no such case here. Nor is the case like that of a review by a Circuit Court of Appeals of decisions of boards, such as the Board of Tax Appeals, where the évidence is before the appellate court and the question is whether there was substantialevidence before the Board to support the findings made. Cf. Phillips v. Commissioner, 283 U. S. 589, 600; Helvering v. Rankin, 295 U. S. 123, 131; Helvering v. Tex-Penn Co., 300 U. S. 481, 491. We must take the findings of fact as made below. If, in the instant case, the subordinate findings had required a de-cree in favor of the Government the case would not hâve been remanded. United States v. Esnault-Pelterie, supra, p. 206; Botany Mills v. United States, 278 U. S. 282, 290; United States v. Wells, 283 U. S. 102, 120. And it cannot be said that the ultimate findings, now made, as 32 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. to validity and infringement are necessarily overbome by the subordinate findings. The argument that the Government is precluded from obtaining the sort of review which is permissible in this Court, when there is a conflict between circuit courts of appeals as to validity and infringement of, patents, and the questions are submitted upon the evidence taken in the District Court, is unavailing, for the resuit is due to the procedure which has been established by the Congress for the détermination of daims against the United States. The judgment is Affirmed. Mr. Justice Black is of the opinion that the findings do not show infringement of any valid patent; or that Appellee invented either a vertical lever or a universal joint or the combined use of a vertical lever and a universal joint to control air planes or machinery; he believes the findings show that such means of control were in general use long before Appellee—five years after his original application for a patent—filed an amendment asserting this claim. For these reasons he believes the judgment should be reversed. Mr. Justice Cardozo took no part in the considération and decision of this case. LONERGAN v. UNITED STATES. Opinion of the Court. 33 LONERGAN v. UNITED STATES. CERTIORARI TO THE CIRCUIT COURT OF APPEALS FOR THE NINTH CIRCUIT. No. 121. Argued January 10, 1938.—Decided January 31, 1938. An appellant to the Circuit Court of Appeals has a right to rely upon the rules of that court, properly construed, which govern his assignments of error, and can not be prejudiced by additions to the requirements made by amendment of the rules between the appeal and the decision of the case. P. 35. Rule 11 of the Circuit Court of Appeals for the Ninth Circuit, before its recent amendment, provided: “When the error alleged is to the admission or the rejection of evidence the assignaient of errors shall quote the full substance of the evidence admitted or rejected.” Held that it was satisfied by some, if not ail, of 28 assignments which that court rejected in this case. 88 F. (2d) 591, reversed. Certiorari, 302 U. S. 663, to review affirmance of a conviction in a criminal case. Mr. Pierce Lonergan, pro se. Mr. J. Albert Woll, with whom Soliciter General Reed, Assistant Attorney General McMahon, and Messrs. William W. Barron and W. Marvin Smith were on the brief, for the United States. Mr. Justice McReynolds delivered the opinion of the Court. In the District Court, Western District of Washington, the petitioner was convicted of violating § 215 Criminal Code ; 18 U. S. C. 338, by using the mails for fraudulent purposes. He appealed to the Circuit Court of Appeals, Ninth Circuit, and filed—August 14, 1936—forty assignments of error. The judgment of conviction was affirmed March 6, 1937, upon an opinion, 88 F. (2d) 591, which, among other things, States— 53383°—38-------3 34 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. “Twenty-eight assignments (numbered 5, 9 to 25, inclusive, and 31 to 40, inclusive) are to the admission of and refusai to strike out evidence. The assignments do not indicate that any of this evidence was objected to in the trial court. They do not state what objections, if any, were made, nor the grounds thereof, nor the grounds, if any, on which appellant moved to strike out the evidence. Such assignments do not conform to our Rule 11 and will not be considered. Cody v. United States (C. C. A. 9), 73 F. (2d) 180, 184; Goldstein v. United States (C. C. A. 9), 73 F. (2d) 804, 806.” This ruling we think was error. Through wrongful interprétation and application of the rule petitioner was denied a proper hearing. At the date of the appeal the pertinent portion of Rule 11 read as follows—“When the error alleged is to the admission or the rejection of evidence the assignment of errors shall quote the full substance of the evidence admitted or rejected.” Concerning this provision, the opinion in Goldstein v. United States, (1934) 73 F. (2d) 804, 806, declared— “The assignment of error must not only quote The full substance of the evidence admitted or rejected,’ but it must also state the error asserted and intended to be urged. This requires that the objection and ruling of the court upon the objection and the exception to the ruling be incorporated in the assignment of error.” Adher-ing to this interprétation, the court persistently refused to consider assignments deemed not in conformity therewith. Between the appeal and announcement of the opinion under considération, Rule 11 was amended so as to provide—“When the error alleged is to the admission or rejection of evidence the assignment of error shall quote the ground urged at the trial for the objection and the exception taken and the full substance of the evidence admitted or rejected.” 33 LONERGAN v. UNITED STATES. Opinion of the Court. 35 Manifestly petitioner had the right to rely upon the rule, properly construed, as it stood at the time of his appeal—before the amendment. And if analysis of one of the rejected assignments discloses substantial compliance, the cause must go back for further considération of the record. Litigants may not be deprived of a hearing upon their points by wrongful construction of rules nor by their ar-bitrary application. An unwarranted construction has been given to the language of Rule 11; properly inter-preted, it did not require petitioner to do ail the things specified by the amendment. The substance of Assignment No. XVI follows— “The court erred in admitting in evidence, and denying defendant’s motion to strike, to which exceptions were taken and allowed, plaintiff’s Exhibit No. 75, being a letter on the letterhead of Battle, Hulbert, Helsell & Bettens, as follows:” [This letter—a long one—dated August 17,1934, addressed to petitioner and signed Battle, Hulbert, Helsell & Bettens, by Joseph E. Gandy, is set out in full. It States, among other things, that certain “allégations and persuasions” made by the petitioner to one Atwood “were obviously fraudulently made” and that one “Atwood was defrauded by the misrepresentations,” etc.] “The testimony in support of its admission given by witnesses A. M. Atwood and Joseph Gandy, is substan-tially as follows.” [Here follows a résumé of the testimony given by these witnesses.] “The reasons such Exhibit should not hâve been ad-mitted, and that it should hâve been stricken, are as follows : “1. It was hearsay evidence, contained conclusions of third parties, and happened subséquent to the termina-tion of the alleged plan. “2. It was a self serving statement of a third party making the statements therein contained. 36 OCTOBER TERM, 1937. Syllabus. 303 U. S. “3. It was highly incompetent, irrelevant and immate-rial, and in its nature highly préjudiciai to the défendant. Its admission was not necessary to clarify 76-A and it was not related to 76-B.” We think this assignment adequately met the applicable requirements of Rule 11. Clearly, it quoted the full substance of the evidence admitted and was definite enough to enable both court and opposing counsel readily to perceive the point intended to be relied on. Seaboard Air Line Ry. Co. v. Watson, 287 U. S. 86, 91. Other assignme'nts also seem sufficiently definite and formai to demand considération. We do not pass upon the merits of any assignment and décidé only that some, if not ail, of them were improperly rejected. The challenged judgment must be reversed. The cause will be remanded to the Circuit Court of Appeals for further proceedings in harmony with this opinion. Reversed. Mr. Justice Cardozo took no part in the considération and decision of this case.. MUNRO v. UNITED STATES. CERTIORARI TO THE CIRCUIT COURT OF APPEALS FOR THE SECOND CIRCUIT. No. 218. Argued January 6, 7, 1938.—Decided January 31, 1938. 1. A suit in the District Court to recover on a War Risk insurance policy, the procedure in which is the same as that provided in §§ 5 and 6 of the Tucker Act, was not brought in time to toll the statute of limitations where the complaint was not filed with the clerk of the court before the period of limitations expired. P. 39. To commence the suit in accordance with §§ 5 and 6 of the Tucker Act, it was not enough to serve a copy of the summons upon the District Attorney and mail another to the Attorney General. 36 MUNRO v. UNITED STATES. Opinion of the Court. 37 2. Suits against the United States can be maintained only by permission, in the manner prescribed and subject to the restrictions imposed. The Conformity Act can not be relied upon to change any of these. P. 41. 3. A District Attorney has no power to waive conditions or limitations imposed by statute in respect of suits against the United States. Id. 89 F. (2d) 614, affirmed. Certiorari, 302 U. S. 668, to review the reversai of a judgment against the United States in a suit on a War Risk Insurance claim. Messrs. Alger A. Williams and Charles H. Kendall, with whom Mr. George Clinton, Jr., was on the brief, for petitioner. Mr. Julius C. Martin, with whom Solicitor General Reed, and Messrs. Wilbur C. Pickett, Fendall Marbury, and W. Marvin Smith were on the brief, for the United States. By leave of Court, Messrs. Charles B. Rugg, H. Brian Holland, and Warren F. Farr filed a brief on behalf of the Bâtes Manufacturing Co., as amicus curiae, in support of petitioner. Mr. Justice McReynolds delivered the opinion of the Court. Certiorari was granted because of conflicting views in the lower courts. Claiming to be permanently and totally disabled, petitioner instituted an action in the United States District Court, Western District of New York, to recover under a War Risk Insurance Policy. He was honorably discharged in 1919. Before the cause came on for trial respondent moved for dismissal because the action was not brought within 38 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. the time prescribed by § 19, World War Vétérans Act 1924, as amended by Act July 3,1930, 46 Stat. 992, copied in the margin.1 This motion was overruled. Whether properly so, is the matter for our considération. 1 Act of July 3, 1930, c. 849, 46 Stat. 992. “Sec. 19. In the event of disagreement as to claim, including claim for refund of premiums, under a contract of Insurance between the bureau and any person or persons claiming thereunder an action on the claim may be brought against the United States either in the Suprême Court of the District of Columbia or in the district court of the United States in and for the district in which such persons or any one of them résides, and jurisdiction is hereby con-ferred upon such courts to hear and détermine ail such controversies. The procedure in such suits shall be the same as that provided in sections 5 and 6 of the Act entitled ‘An Act to provide for the bringing of suits against the Government of the United States,’ approved March 3, 1887, and section 10 thereof so far as applicable. . . . “No suit on yearly renewable term Insurance shall be allowed under this section unless the same shall hâve been brought within six years after the right accrued for which the claim is made or within one year after the date of approval of this amendatory Act, which-ever is the later date, and no suit on United States Government life (converted) insurance shall be allowed under this section unless the same shall hâve been brought within six years after the right accrued for which the claim is made; Provided, that for the purposes of this section it shall be deemed that the right accrued on the happening of the contingency on which the claim is founded: Provided jurther, That this limitation is suspended for the period elapsing between the filing in the bureau of the claim sued upon and the déniai of said claim by the director. . . .” Tucker Act, March 3, 1887, c. 359, 24 Stat. 506. Sec. 5; U. S. C., Title 28, § 762. “Pétition in suit against United States. The plaintiff in any suit brought under the provisions of section 41, paragraph 20, of this title shall file a pétition, duly verified with the clerk of the respective court having jurisdiction of the case, and in the district where the plaintiff résides. Such pétition shall set forth the full name and résidence of the plaintiff, the nature of his claim, and a succinct statement of the facts upon which the claim is based, the money or any other thing claimed, or the damages sought to be recovered 36 MUNRO v. UNITED STATES. Opinion of the Court. 39 By concession it was necessary to bring suit not later than July 1, 1933. March 16, 1933, a praecipe for issuance of summons was filed with the Clerk of the District Court; on the same day copy of the summons was served upon the United States Attorney in Buffalo and another mailed to the Attorney General at Washington; no copy of the com-plaint was served upon the United States Attorney until July 26, 1933; the original complaint was not filed with the Clerk until April 23, 1936. February 15, 1934, the United States Attorney filed an answer without questioning the timeliness of the suit; a year later he moved to dismiss. The cause was heard in April, 1936; judgment went for the assured July 29, 1936. In following the above described procedure petitioner’s counsel acted upon information given by the Assistant United States Attorney, who declared that service of summons would suffîce to give jurisdiction and toll the statute; that complaint might be served thereafter. Two points are presented. Did procuring the summons, serving one copy on the United States Attorney and sending another to the Attorney General begin the and praying the court for a judgment or decree upon the facts and law.” Sec. 6; U. S. C., Title 28, § 763. “Service; appearance by district attorney. The plaintiff shall cause a copy of his pétition filed under section 762 of this title, to be served upon the district attorney of the United States in the district wherein suit is brought, and shall mail a copy of the same, by regis-tered letter, to the Attorney General of the United States, and shall thereupon cause to be filed with the clerk of the court wherein suit is instituted an affidavit of such service and the mailing of such letter. It shall be the duty of the district attorney upon whom service of pétition is made as aforesaid to appear and defend the interests of the Government in the suit, and within sixty days after the service of pétition upon him, unless the time should be extended by order of the court made in the case to file a plea, answer, or demurrer on the part of the Government, , , 40 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. suit within the requirement of the statute? If not, do the circumstances establish waiver of the defense that suit was out of time. Section 19, Act of 1924, permits an action on a War Risk policy to be brought in the United States District Court for the district in which the claimant résides. Also directs, “The procedure in such suits shall be the same as that provided in Sections 5 and 6” (§§ 762 and 763, Title 28, U. S. C.) of the Tucker Act of March 3, 1887, “and Section 10 thereof [§ 765, Title 28, U. S. C.] insofar as applicable.” Sec. 5 of the Tucker Act provides that the plaintiff “shall file a pétition” with the Clerk of the court, containing a succinct statement of the facts upon which the claim is based; Sec. 6 that he shall cause one copy of this to be served upon the District Attorney and mail another to the Attorney General. These requirements were not complied with prior to July 1, 1933. The Circuit Court of Appeals held the suit was not brought in time to toll the statute, and with this conclusion we agréé. The opinion there adequately refers to the sundry opinions which hâve considered the subject, discloses the daims of the parties and reasons for the judgment. Affirmation here, upon authority of United States n. Larkin, 208 U. S. 333, of the District Court’s judgment in United States v. Mill Creek, etc., and two similar causes (Nos. 103, 104, 105, Oct. Term 1919), 251 U. S. 539, cannot properly be regarded as authority for a view con-trary to the one we now approve. Those causes came up under a statute which permitted direct appeals from District Courts solely upon questions of jurisdiction. We determined only that the District Court had power to hear and rule upon the questions presented to it—among them whether the suits were brought in time. The merits of the controversy—whether in reality the suits were in time—we did not consider. Examination of the opin- MYERS v. BETHLEHEM CORP. 41 36 Syllabus. ion in Larkin’s case and the statute then in force will make this clear enough. Suits against the United States can be maintained only by permission, in the manner prescribed and subject to the restrictions imposed. Reid v. United States, 211 U. S. 529, 538. The Conformity Act cannot be relied upon to change any of these. The District Attorney had no power to waive conditions or limitations imposed by statute in respect of suits against the United States. Finn v. United States, 123 U. S. 227, 233. Judgment against them is not permissible if first sought after expiration of the time allowed. . Affirmed. Mr. Justice Cardozo took no part in the considération and decision of this case. MYERS et al. v. BETHLEHEM SHIPBUILDING CORP.* CERTIORARI TO THE CIRCUIT COURT OF APPEALS FOR THE FIRST CIRCUIT. No. 181. Argued January 5, 1938.—Decided January 31, 1938. 1. The National Labor Relations Board, upon a charge made to it, issued a complaint against a corporation engaged, at the plant involved, in the building and sale of ships, boats and marine equipment. The complaint alleged that the corporation domi-nated and interfered, in a manner described, with a labor organi-zation of its employées, and was thus engaged in unfair labor practices affecting commerce within the meaning of the National Labor Relations Act of July 5, 1935. The corporation was given notice of a hearing to be had upon the complaint. Héld: (1) That the District Court had no jurisdiction of a suit by the corporation to enjoin the Board from holding the hearing. P. 47. *Together with No. 182, Myers et al. n. MacKenzie et al., also on writ of certiorari to the Circuit Court of Appeals for the First Circuit. 42 OCTOBER TERM, 1937. Syllabus. 303 U. S. The bill alleged that the business of the company at the plant affected, and the sale of its products, were not in Interstate or foreign commerce; that the holding of the hearings would be futile and would irreparably damage the company, by expense and inconvenience, impairment of the good will and harmonious relations existing between it and its employées, and lowered efficiency of its operations. (2) That the District Court had no jurisdiction of a suit by employées of the corporation who were officers of a labor organi-zation at the plant, to enjoin the Board from holding the hearing,— the bill in this case alleging further that the employées are satisfied with their existing contracts of employment and desire to retain the existing plan of représentation without change; that the holding of the proposed hearing will discrédit the plan and destroy its useful-ness to the employées; that they will "be deprived of their right to negotiate by the method of their choice, the value of which has been proved by years of operation; that alteration of the plan will cause dissatisfaction among the employées; that operation of plant will be disrupted by labor disturbances; that employment will be interrupted; and that the damage to the employées will be irréparable. P. 53. 2. In the National Labor Relations Act, Congress provided for ap-propriate procedure before the Labor Board and an adéquate op-portunity, through review by the Circuit Court of Appeals, to secure judicial protection against possible illégal action by the Board; and the grant to the Board and the Circuit Court of Appeals of exclusive jurisdiction “to prevent any person from engaging in any unfair labor practice affecting commerce” is constitutional. P. 48. 3. The conclusion that the District Court is without jurisdiction to enjoin the holding of a hearing by the Labor Board, even though it be claimed that interstate or foreign commerce is not involved and that the holding of a hearing would cause irréparable injury, does not deny any rights guaranteed by the Fédéral Constitution. P. 50. 4. «The rule requiring exhaustion of the administrative remedy can not be circumvented by a claim that the charge on which the com-plaint rests is groundless and that the mere holding of the pre-scribed administrative hearing would resuit in irréparable damage. P. 51. 5. The general rule that the decree of a District Court granting or denying a preliminary injunction will not be disturbed on appeal, 41 MYERS v. BETHLEHEM CORP. Opinion of the Court. 43 has no application where there is an insuperable objection in point of jurisdiction to the maintenance of the suit and where it clearly appears that the decree was the resuit of an improvident exercise of judicial power. In such case, dismissal of the bill should be directed. P. 52. 88 F. (2d) 154; 89 id. 1000, reversed. Certiorari, 302 U. S. 667, to review decrees affirming decrees of the District Court in two cases, 15 F. Supp. 915, heard together below. The decrees granted prelim-inary injunctions restraining the holding of a hearing by the National Labor Relations Board. Mr. Robert B. Watts, with whom Solicitor General Reed, and Messrs. Robert L. Stem, Charles Fahy, and Philip Levy were on the brief, for petitioners. Mr. Claude R. Branch, with whom Messrs. Frederick H. Wood, John L. Hall, and E. Fontaine Broun were on the brief, for respondent in No. 181. Mr. B. A. Brickley, with whom Messrs. Alexander G. Gould and Oliver R. Waite were on the brief, for respond-ents in No. 182. Mr. Justice Brandeis delivered the opinion of the Court. The question for decision is whether a fédéral district court has equity jurisdiction to enjoin the National Labor Relations Board from holding a hearing upon a complaint filed by it against an employer alleged to be engaged in unfair labor practices prohibited by National Labor Relations Act, July 5, 1935, c. 372, 49 Stat. 449. The Circuit Court of Appeals for the First Circuit held in these cases that the District Court possesses such jurisdiction; and granted preliminary injunctions. Every other Circuit Court of Appeals in which the question has arisen has 44 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. held the contrary.1 Because of the importance of the questions presented, the conflict in the lower courts and alleged conflict with our own decisions, we granted these writs of certiorari. The declared purpose of the National Labor Relations Act is to diminish the causes of labor disputes burdening and obstructing Interstate and foreign commerce; and its provisions are applicable only to such commerce. In order to protect it the Act seeks to promote collective bargaining; confers upon employées engaged in such commerce the right to form, and join in, labor organiza-tions; defines acts of an employer which shall be deemed unfair labor practice; and confers upon the Board certain limited powers with a view to preventing such practices. If a charge is made to the Board that a person “has engaged in or is engaging in any . . . unfair labor practice,” and it appears that a proceeding in respect thereto should be instituted, a complaint stating the charge is to be fîled, and a hearing is to be held thereon upon notice to the person complained of. The Industrial Union of Marine and Shipbuilding Workers of America, Local No. 5, made to the Board a charge that the Bethlehem Shipbuilding Corporation, Ltd.,2 was engaging in unfair labor practices at its plant in Quincy, Massachusetts, for the production, sale and 1E. L Dupont de Nemours & Co. v Boland, 85 F. (2d) 12 (C. C. A. 2); Newport News Shipbuilding & Dry Dock Co. v. Schau filer, 91 F. (2d) 730 (C. C. A. 4); Bradley Lumber Co. v. National Labor Relations Board, 84 F. (2d) 97 (C. C. A. 5) ; Clark v. Lindemann & Hoverson Co., 88 F. (2d) 59 (G. C. A. 7); Pratt v. Oberman & Co., 89 F. (2d) 786 (C. C. A. 8); Héller Bros. Co. v. Lind, 66 App. D. C. 306 ; 86 F. (2d) 862; cf. Bowen v. James Vernor Co., 89 F. (2d) 968 (C C. A. 6) ; Carlisle Lumber Co. v. Hope, 83 F. (2d) 92 (C. C. A. 9) ; Lyons v. Eagle-Picher Lead Co., 90 F. (2d) 321 (C. C. A. 10). 2 A Delaware corporation, with its principal place of business at Bethlehem, Pennsylvania. MYERS v. BETHLEHEM CORP. 45 41 Opinion of the Court. distribution of boats, ships, and marine equipment. Upon that charge the Board filed, on April 13, 1936, a complaint which alleged, among other things, that the company dominâtes and interfères in the manner de-scribed “with a labor organization known as Plan of Représentation of Employées in Plants of the Bethlehem Shipbuilding Corporation, Ltd.”; that such action leads to strikes interfering with Interstate commerce; and that “the aforesaid acts of respondent constitute unfair labor practices affecting commerce, within the meaning of Section 8, subdivisions (1) and (2) and Section 2, subdivisions (6) and (7) of said [National Labor Relations] Act.” The complaint alleged, specifically: “The respondent in the course and condûct of its business causes and has continuously caused large quantifies of the raw materials used in the production of its boats, ships and marine equipment to be purchased and transported in Interstate commerce from and through states of the United States other than the State of Massachusetts to the Fore River Plant in the State of Massachusetts, and causes and has continuously caused the boats, ships and marine equipment produced by it to be sold and transported in Interstate commerce from the Fore River Plant in the State of Massachusetts to, into and through states of the United States other than the State of Massachusetts, ail of the aforesaid consti-tuting a continuous flow of trade, traffic and commerce among the several states.” The Board duly notified the Corporation that a hear-ing on the complaint would be held on April 27, 1936, at Boston, Massachusetts, in accordance with Rules and Régulations of the Board, a copy of which was annexed to the notice; and that the Corporation “will hâve the right to appear, in person or otherwise, and give testimony.” 46 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. On that day the Corporation filed, in the fédéral court for Massachusetts, the bill in equity, herein numbered 181, against A. Howard Myers, Acting Régional Director for the First Région, National Labor Relations Board, Edmund J. Blake, its Régional Attorney for the First Région, and Daniel M. Lyons, Trial Examiner, to enjoin them from holding “a hearing for the purpose of deter-mining whether or not the plaintiff has engaged at its Fore River Plant in any so-called unfair labor practices under the National Labor Relations Act, and from having any proceedings or taking any action whatsoever, at any time or times, with respect thereto.” There were pray-ers for a restraining order, an interlocutory injunction and a permanent injunction; and, also, a prayer that the court déclaré that the National Labor Relations Act and “défendants’ actions and proposed actions thereunder” violate the Fédéral Constitution. On May 4, 1936, another bill in equity, herein numbered 182, against the same défendants, seeking, on largely the same allégations of fact, substantially the same relief, was brought in the same court by Charles MacKenzie, James E. Manning and Thomas E. Barker, employées of the Bethlehem Corporation and officers of the so-called Plan of Représentation at the Fore River Plant.3 Upon the filing of each bill, the District Court issued a restraining order and an order of notice to show cause why a preliminary injunction should not issue. In each case the défendants filed a motion to dismiss the bill of complaint and also a return to the order to show cause. The cases were heard together. In each, the District Court issued the preliminary injunction ; and the decrees therefor are still in effect. They were affirmed by the Circuit Court of Appeals for the First Circuit on Febru- 8 A substituted bill of complaint was filed May 7, 1936. MYERS v. BETHLEHEM CORP. 47 41 Opinion of the Court. ary 12, 1937. 88 F. (2d) 154. Pétitions for a rehearing, based upon the conflict with the decisions of other circuit courts of appeals were denied. And the court denied also motions for leave to file a second pétition for rehearing, based upon the decisions of this Court in National Labor Relations Board v. Jones & Laughlin Steel Corp., 301 U. S. 1, and other cases rendered April 12, 1937. 89 F. (2d) 1000. The District Court denied the motions to dismiss the bills. 15 F. Supp. 915. But the review by the Circuit Court of Appeals dealt only with the decrees for a preliminary injunction. The two cases présent, in the main, the same questions. In discussing them reference will be made, in the first instance, only to the suit brought by the Corporation. We are of opinion that the District Court was without power to enjoin the Board from holding the hearings. First. There is no claim by the Corporation that the statutory provisions and the rules of procedure prescribed for such hearings are illégal; or that the Corporation was not accorded ample opportunity to answer the complaint of the Board; or that opportunity to introduce evidence on the allégations made will be denied. The claim is that the provisions of the Act are not applicable to the Cor-poration’s business at the Fore River Plant, because the operations conducted there are not carried on, and the Products manufactured are not sold, in Interstate or for-eign commerce; that, therefore, the Corporation’s relations with its employées at the plant cannot burden or interfère with such commerce; that hearings would, at best, be futile; and that the holding of them would resuit in irréparable damage to the Corporation, not only by reason of their direct cost and the loss of time of its officiais and employées, but also because the hearings would cause serioug impairment of the good will and harmonious relations existing between the Corporation 48 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. and its employées, and thus seriously impair the efficiency of its operations.4 Second. The District Court is without jurisdiction to enjoin hearings because the power “to prevent any per-son from engaging in any unfair practice affecting commerce,” has been vested by Congress in the Board and the Circuit Court of Appeals, and Congress has declared: “This power shall be exclusive, and shall not be affected by any other means of adjustment or prévention that has been or may be established by agreement, code, law, or other-wise.”6 The grant of that exclusive power is constitutional, because the Act provided for appropriate procedure before the Board and in the review by the Circuit Court of Appeals an adéquate opportunity to secure judicial protection against possible illégal action on the part of the Board. No power to enforce an order is con-ferred upon the Board. To secure enforcement, the Board must apply to a Circuit Court of Appeals for its affirm-ance. And until the Board’s order has been affirmed by the appropriate Circuit Court of Appeals, no penalty accrues for disobeying it. The independent right to apply to a Circuit Court of Appeals to hâve an order set aside 4 It is alleged that in 1934 and 1935 the predecessor of the présent National Labor Relations Board instituted somewhat similar action against the Corporation. Although the proceedings were eventually dismissed, the hearings consumed a total of some 2500 hours of working time of officiais and employées and cost the Corporation more than $15,000, none of which could be recovered. 'Compare House Committee Report, H. R. Rep. 1147, 74th Cong., Ist Sess., p. 24: “any person aggrieved by a final order of the Board granting or denying in whole or in part the relief sought may claim a review of such order in the appropriate circuit court of appeals, or in the Court of Appeals of the District of Columbia. It is in-tended here to give the party aggrieved a full, expeditious, and exclusive method of review in one proceeding after a final order is made. Until such final order is made the party is not injured, and cannot be heard to complain, as has been held in cases under the Fédéral Trade Commission Act.” 41 MYERS v. BETHLEHEM CORP. Opinion of the Court. 49 is conferred upon any party aggrieved by the proceeding before the Board. The Board is even without power to enforce obedience to its subpoena to testify or to produce written evidence. To enforce obedience it must apply to a District Court; and to such an application appropriate defence may be made.8 As was said in National Labor Relations Board v. Jones & Laughlin Steel Corp., 301 U. S. 1, 46, 47, the procédural provisions, “do not offend against the constitutional requirements governing the création and action of administrative bodies. See Interstate Commerce Commission v. Louisville & Nash ville R. Co., 227 U. S. 88, 91. The Act establishes standards to which the Board must conform. There must be complaint, notice and hearing. The Board must receive evidence and make findings. The findings as to the facts are to be conclusive, but only if supported by evidence. The order of the Board is subject to review by the designated court, and only when sustained by the court may the order be enforced. Upon that review ail questions of the jurisdiction of the Board and the regu-larity of its proceedings, ail questions of constitutional right or statutory authority, are open to examination by the court. We construe the procédural provisions as affording adequhte opportunity to secure judicial protection against arbitrary action in accordance with the well-settled rules applicable to administrative agencies set up by Congress to aid in the enforcement of valid législation.” It is true that the Board has jurisdiction only if the complaint concerns Interstate or foreign commerce. Unless the Board finds that it does, the complaint must be dis-missed. And if it finds that Interstate or foreign commerce 6 See § 11 of the Act and Article II, §§ 20 and 21, of the Rules and Régulations issued April 27, 1936. Cf. Fédéral Trade Commission v. Claire Fumace Co., 274 U. S. 160; E. I. Dupont de Nemours & Co. v. Boland, 85 F. (2d) 12 (C C. A. 2). 53383°—38---------4 50 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. is involved, but the Circuit Court of Appeals concludes that such finding was without adéquate evidence to support it, or otherwise contrary to law, the Board’s pétition to enforce it will be dismissed, or the employer’s pétition to hâve it set aside will be granted.7 Since the procedure before the Board is appropriate and the judicial review so provided is adéquate, Congress had power to vest exclusive jurisdiction in the Board and the Circuit Court of Appeals. Anniston Manufacturing Co. v. Davis, 301 U. S. 337, 343-346. Third. The Corporation contends that, since it déniés that Interstate or foreign commerce is involved and daims that a hearing would subject it to irréparable damage, rights guaranteed by the Fédéral Constitution will be denied unless it be held that the District Court has jurisdiction to enjoin the holding of a hearing by the Board.8 So to hold would, as the Government insists, in effect sub-stitute the District Court for the Board as the tribunal to hear and détermine what Congress declared the Board exclusively should hear and détermine in the first instance. The contention is at war with the long settled rule of judicial administration that no one is entitled to judicial relief for a supposed or threatened injury until the pre- 7Section 10 (f) of the Act provides: “Upon such filing, the court shall proceed in the same manner as in the case of an application by the Board under subsection (e), and shall hâve the same exclusive jurisdiction to grant to the Board such temporary relief or restraining order as it deems just and proper, and in like manner to make and enter a decree enforcing, modifying, and enforcing as so modified, or setting aside in whole or in part the order of the Board; and the findings of the Board as to the facts, if supported by evidence, shall in like manner be conclusive.” 8 In support of that contention the following cases were cited: Ohw Valley Water Co. v. Ben Avon Borough, 253 U. S. 287, 289; Bluefield Co. v. Public Service Comm’n, 262 U. S. 679, 683; Phillips v. Commis-sioner, 283 U. S. 589, 600; Crowell v. Benson, 285 U. S. 22, 60, 64; State Corporation Comm’n v. Wichita Cas Co., 290 U. S. 561, 569; St. Joseph Stock Yards Co. v. United States, 298 U. S. 38, 51-52. 41 MYERS v. BETHLEHEM CORP. Opinion of the Court. • 51 scribed administrative remedy has been exhausted.9 That rule has been repeatedly acted on in cases where, as here, the contention is made that the administrative body lacked power over the subject matter.10 Obviously, the rule requiring exhaustion of the administrative remedy cannot be circumvented by assert-ing that the charge on which the complaint rests is groundless and that the mere holding of the prescribed administrative hearing would resuit in irréparable damage.11 Lawsuits also often prove to hâve been ground- 8 The rule has been most frequently applied in equity where relief by injunction was sought. Pittsburgh &c. Ry. v. Board of Public Works, 172 U. S. 32, 44r45; Prentis v. Atlantic Coast Line Co., 211 U. S. 210, 230; Dalton Adding Machine Co. v. State Corporation Comm’n, 236 U. S. 699, 701 ; Gorham Mfg. Co. v. State Tax Comm’n, 266 U. S. 265, 269-70; Fédéral Trade Comm’n v. Claire Furnace Co., 274 U. S. 160, 174; Lawrence v. St. Louis-San Francisco Ry. Co., 274 U. S. 588, 592-93; Chicago, M., St. P. & P. R. Co. v. Risty, 276 U. S. 567, 575; St. Louis-San Francisco Ry. Co. v. Alabama Public Service Comm’n, 279 U. S. 560, 563; Porter v. Investors Syndicale, 286 U. S. 461, 468, 471; United States v. Illinois Central Ry. Co., 291 U. S. 457, 463-64; Hegeman Farms Corp. v. Baldwin, 293 U. S. 163, 172; cf. Red “C” OU Mfg. Co. v. Board of Agriculture, 222 U. S. 380, 394; Famcomb v. Denver, 252 U. S. 7, 12; Milheim v. Moffat Tunnel District, 262 U. S. 710, 723; McGregor v. Hogan, 263 U. S. 234, 238; White v. Johnson, 282 U. S. 367, 374; Petersen Baking Co. v. Bryan, 290 U. S. 570, 575; Pacific Tel. & Tel. Co. v. Seattle, 291 U. S. 300, 304. But because the rule is one of judicial administration—not merely a rule governing the exercise of discrétion—it is applicable to proceedings at law as well as suits in equity. Cf. First National Bank v. Board of County Comm’rs, 264 U. S. 450, 455; Anniston Mfg. Co. v. Davis, 301 U. S. 337, 343. 10 Dalton Adding Machine Co. n. State Corporation Comm’n, 236 U. S. 699; Fédéral Trade Comm’n v. Claire Furnace Co., 274 U. S. 160; Lawrence v. St. Louis-San Francisco Ry. Co., 274 U. S. 588; St. Louis-San Francisco Ry. Co. v. Alabama Public Service Comm’n, 279 U. S. 560; cf. Western & Atlantic R. Co. v. Georgia Public Service Comm’n, 267 U. S. 493, 496, and cases cited in note 1, supra. “Such contentions were specifically rejected in Bradley Lumber Co. v. National Labor Relations Board, 84 F. (2d) 97 (C. C. A. 5) ; 52 . OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. less; but no way has been discovered of relieving a défendant from the necessity of a trial to establish the fact. Fourth. The Circuit Court of Appeals should hâve reversed the decrees for a preliminary injunction. It is true that ordinarily the decree of a District Court grant-ing or denying a preliminary injunction will not be dis-turbed on appeal. But that rule of practice has no application where, as here, there was an insuperable objection to the maintenance of the suit in point of jurisdiction and where it clearly appears that the decree was the resuit of an improvident exercise of judicial discrétion.12 Since the constitutionality of the Act has been determined by our decision in National Labor Relations Board v. Jones & Laughlin Steel Corp., 301 U. S. 1, and Clark v. Lindemann & Hoverson Co., 88 F. (2d) 59 (C. C. A. 7) ; Chamber of Commerce v. Fédéral Trade Comm’n, 52 App. D. C. 40; 280 Fed. 45 (C. C. A. 8) ; Hdler Bros. Co. v. Lind, 66 App. D. C. 306; 86 F. (2d) 862; and Pittsburgh & W. Va. Ry. Co. v. Interstate Commerce Comm’n, 280 Fed. 1014 (App. D. C.). Cf. United States v. Los Angeles & S. L. R. Co., 273 U. S. 299, 314; Lawrence v. St. Louis-San Francisco Ry. Co., 274 U. S. 588; Dalton Adding Machine Co. v. State Corporation Comm’n, 236 U. S. 699; McChord n. Louisville & Nashville Ry. Co., 183 U. S. 483* Richmond Hosiery Mills v. Camp, 74 F. (2d) 200, 201 (C. C. A. 5). The cases cited by the Corporation are not opposed. Watson v. Sutherland, 5 Wall. 74; Pierce v. Society of Sisters, 268 U. S. 510; Walla Walla v. Walla Walla Water Co., 172 U. S. 1; Vicksburg Water-works Co. v. Vicksburg, 185 U. S. 65, 82; Hitchman Coal & Coke Co. v. Mitchell, 245 U. S. 229, 248; Pennsylvania n. West Virginia, 262 U. S. 553, 592, 593; City Bank Farmers Trust Co. v. Schnader, 291 U. S. 24; Truax v. Raich, 239 U. S. 33; Terrace v. Thompson, 263 U. S. 197, 215-16. “ Meccano Ltd. v. John Wanamaker, 253 U. S. 136, 141 ; Lawrence v. St. Louis-San Francisco Ry. Co., 274 U. S. 588 (semble) ; cf. Pren-dergast v. New York Téléphoné Co., 262 U. S. 43,50-51 ; National Pire Insurance Co. n. Thompson, 281 U. S. 331, 338; Alabama v. United States, 279 U. S. 229, 231; Rogers v. HUI, 289 U. S. 582, 587. 41 MYERS v. BETHLEHEM CORP. Opinion of the Court. 53 the defect in the bill is incapable of remedy by amend-ment, its dismissal should be directed.13 Fifth. In No. 182, also, the Circuit Court of Appeals should hâve reversed the decree for a preliminary in-junction and directed dismissal of the bill. The plain-tiffs, officers of the so-called Plan of Représentation of Employées, alleged, in addition to the facts already stated, that the employées are satisfied with their exista ing contracts of employment and desire to retain the existing Plan without change; that the holding of the proposed hearing will discrédit the Plan and destroy its usefulness to the employées; that they will be deprived of their right to negotiate by the method of their choice, the value of which has been proved by years of operation ; that alteration of the Plan will cause dissatisfaction among the employées; that operation of plant will be disrupted by labor disturbances; that employment will be interrupted; and that the damage to the employées will be irréparable. These additional allégations furnish no reason why the Board should be prevented from exer-cising the exclusive initial jurisdiction conferred upon it by Congress. De créé s for preliminary injunction reversed with direction to dismiss the bills. Mr. Justice Cardozo took no part in the considération or decision of this case. 18Smith v. Vulcan Iron Works, 165 U. S. 518, 525; Mast, Foos & Co. v. Stover Mjg. Co., 177 U. S. 485, 494; Metropolitan Water Co. v. Kaw Valley Drainage Dist., 223 U. S. 519, 523; United States Fidelity & Guaranty Co. v. Bray, 225 U. S. 205, 214; Denver v. New York Trust Co., 229 U. S. 123, 136; cf. In re Tampa Suburban R. Co., 168 U. S. 583, 588; Ex parte National Enameling & Stamping Co., 201 U. S. 156, 162; Meccano Ltd. v. John Wanamaker, 253 U. S. 136, 141. 54 OCTOBER TERM, 1937. Counsel for Parties. 303 U. S. NEWPORT NEWS SHIPBUILDING & DRY DOCK CO. v. SCHAUFFLER et al. CERTIORARI TO THE CIRCUIT COURT OF APPEALS FOR THE FOURTH CIRCUIT. No. 305. Argued January 5, 1938.—Decided January 31, 1938. 4. Bethlehem Shipbuilding Corp. v. Myers, ante, p. 41, followed. P. 57. 2. In a suit in equity to enjoin the holding of a hearing upon a complaint issued by the National Labor Relations Board, allégations of the bill that interstate or foreign commerce is not involved are conclusions of law, and are not admitted by a motion to dismiss. P. 57. 3. The National Labor Relations Act does not vest in the Labor Board exclusive power to détermine its own jurisdiction. It con-fers upon the Board exclusive initial power to make the investigation, but provides for judicial review by the Circuit Court of Appeals. P. 57. 4. There is no basis in the Act for the contention that the District Court may entertain a suit to prevent the Board from conducting a public investigation under § 10 if the employer daims that it is not engaged in interstate or foreign commerce. P. 58. 5. A cause in which équitable relief was sought to prevent injury which allegedly would resuit from the holding of a hearing by the Labor Board can not be disposed of as moot where, though the hearing has in the meantime been held, the trial examiner has not yet made his report to the Board, the Board has made no decision, and there is thus a possibility of further proceedings. P. 58. 91 F. (2d) 730, affirmed. Certiorari, 302 U. S. 673, to review a decree affirming the dismissal of a bill which sought to restrain officiais of the National Labor Relations Board from holding a hearing upon a complaint issued against the shipbuilding company. Messrs. H. H. Rumble and Fred H. Skinner for peti-tioner. NEWPORT NEWS CO. v. SCHAUFFLER. 55 54 Opinion of the Court. Mr. Robert B. Watts, with whom Solicitor General Reed, and Messrs. Robert L. Stem, A. H. Feller, and Charles Fahy were on the brief, for respondents. Mr. Justice Brandeis delivered the opinion of the Court. The Newport News Shipbuilding and Dry Dock Company is a Virginia corporation engaged in the construction, overhaul and repair of ships at its plant in that State. In June, 1937, the Industrial Union of Marine and Shipbuilding Workers of America filed with the National Labor Relations Board the charge that the Company was “dominating and interfering with the employées’ right of self organization by dominating, interfering with and lending financial support to a so-called labor organization” at said plant known as “Représentation of Employées”; that the Company had discharged and re-fused to reinstate several employées at the plant “be-cause they joined and assisted a labor organization of their own choosing and engaged in concerted activities with fellow employées for collective bargaining and other mutual aid and protection”; and that by so doing the Company was engaged in unfair labor practices within the meaning of § 8, subsections (1), (2) and (3) of the National Labor Relations Act. Thereupon, the Board, through its Régional Director for the 5th Région, Bennett F. Schaufîler, filed a complaint against the Company and gave notice of a hearing pursuant to § 10 (b) of the Act. The Company did not answer the complaint. Before the date assigned for the hearing, it brought, in the fédéral court for eastern Virginia, this suit, in which it sought to enjoin Schaufîler, Jacob Blum, the Régional Attorney for the 5th Région, both citizens of Maryland, and the Trial Examiner designated or to be designated, from holding the hearing and taking further proceedings un- 56 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. der the Act. There were prayers for both an interlocu-tory and a final injunction and for a declaratory judg-ment that the Act as applied to the Company’s business and its relations to its employées is unconstitutional. As the basis for this relief it alleged facts similar to those set forth in the bill of the Bethlehem Shipbuilding Corporation, Ltd., in No. 181, ante, p. 41. It alleged, spe-cifically, that neither the Company’s business nor its relations with its employées affected Interstate or for-eign commerce; that it had not engaged in any unfair labor practice; and that it would be irreparably dam-aged by the holding of the hearing of the Board and the taking of any action in connection therewith. Among the éléments of irréparable injury alleged were that the Company would be held up to scorn as a violator of a law of the United States and so would incur for as long as the proceedings lasted the odium and ill will of the pubüc and of its own employées; that its officiais would be compelled to produce evidence of a confidential nature; and that the pendency and holding of the Board’s proceedings, regardless of their outcome, would impede the Company in exercising its right to bargain freely with its employées. The case was heard by the District Court upon the plaintiff’s application for a temporary injunction and the défendants’ motion that the bill be dismissed on the ground, among others, that the Company had failed to exhaust its administrative remedies and that granting the refief prayed would be an usurpation of the authority exclusively vested by the Act in the Court of Appeals. The court denied the temporary injunction and dismissed the bill on the ground that the Company had “a plain, adéquate and exclusive remedy under the terms of the Act itself, that no irréparable damage is threatened, and that this [the District] Court has no jurisdiction of the controversy presented by the bill.” That decree was af- NEWPORT NEWS CO. v. SCHAUFFLER. 57 54 Opinion of the Court. firmed by the Court of Appeals for the Fourth Circuit, which held that the Company “has an adéquate remedy under the statute and may not apply for relief in equity until it has exhausted the administrative remedy there provided.” 91 F. (2d) 730. We granted certiorari because of conflict with Bethle-hem Shipbuïlding Corp. n. Myers, 89 F. (2d) 1000, in which the facts are substantially similar and the issues the same. That case is reversed by our opinion delivered this day in No. 181. For the reasons there stated, we affirm the decree herein, adding only the following. First. The Company insists that since the case was heard on motion to dismiss the bill which allégés that the Company is not engaged in Interstate or foreign commerce and its relations to its employées do not affect such commerce, these allégations must be accepted as true. The motion adrnits as facts allégations describing the manner in which the business is carried on, but not legal conclusions from those facts. The allégations that Interstate or foreign commerce is not involved are conclusions of law.1 Second. The Company urges that, since the Board can hâve jurisdiction only over businesses engaged in inter-state or foreign commerce, since the Company déniés that it is so engaged, and the Fédéral Constitution does not permit vesting in an administrative body exclusive power to détermine its own jurisdiction, the District Court must hâve power to pass upon that issue. The Act does not purport to leave the détermination wholly to the Board. It confers upon the Board exclusive initial power to make the investigation, but provides for judicial review by the 1 Compare Pennie v. Reis, 132 U. S. 464, 469-470; Pierce Oil Corp. v. Hope, 248 U. S. 498, 500; Nortz v. United States, 294 U. S. 317, 324-325; Pacific States Box & Basket Co. v. White, 296 U. S. 176, 184-185. 58 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. Circuit Court of Appeals.2 As the only question here in-volved is the power of the Board to make the investigation, we hâve no occasion to consider the extent of the review provided. It is suggested that while the Board has the right and duty to make, under § 5 of the Act, a preliminary informai inquiry before public action, for the purpose of informing itself whether a particular concern is subject to its author-ity, the District Court may entertain a suit to prevent the Board from conducting a public investigation under § 10 if the concern claims that it is not engaged in Interstate or foreign commerce. The limitation suggested would, in large measure, defeat the purpose of the législation. There is no basis in the Act for such a contention. Third. The Circuit Court of Appeals having refused to grant an injunction staying the action by the Board pending the contemplated appeal, application for a stay was made to Mr. Justice Butler of this Court, after filing of the pétition for a writ of certiorari. It has been called to our attention that, upon his déniai of that application, the hearing was held before the trial examiner of the Board from August 30 to September 8, 1937, and has apparently been closed. To the extent that relief was sought to prevent the injury resulting from a hearing, the cause appears to be moot. But the cause cannot be dis-posed of as moot, as the trial examiner has not yet made his report to the Board; the Board has made no decision; and thus there is a possibility of further proceedings. Decree affirmed. Mr. Justice Cardozo took no part in the considération or decision of this case. 2§ 10 (a), (e), (f). See National Labor Relations Board n. Jones & Laughlin Steel Co., 301 U. S. 1, 47; Myers v. Bethlehem Ship-building Corp., ante, p. 41. ADAM v. SAENGER. Syllabus. 59 ADAM v. SAENGER et al. CERTIORARI TO THE COURT OF CIVIL APPEALS FOR THE NINTH SUPREME JUDICIAL DISTRICT OF TEXAS. No. 197. Argued January 6, 1938.—Decided January 31, 1938. 1. Matter of fact or of law upon which the jurisdiction of a State court to render a judgment depended, but which was not liti-gated in that court, is matter for adjudication by the court of another State in an action on the judgment. P. 62. 2. Upon an appeal from the judgment of a state court in a suit upon a judgment of another State, this Court takes judicial notice of the law of the latter State to the same extent as such notice is taken by the court appealed from. P. 63. 3. According to Texas law the legal effect of a judgment of another State, on which suit is brought, is to be determined by the court, not the jury. But a suitor who asserts that the effect is different from that of a similar judgment of the courts of Texas is required to allégé specifically and prove as a matter of fact the particular law or usage on which he relies to establish the différence; and, on demurrer, only the law or usage specifically alleged will be considered in determining whether the law of the other State differs from that of Texas. P. 63. 4. A, being sued by B, a résident of Texas, in a court of general jurisdiction in California, brought a cross-action in the same court against B with leave of court and by service in California of a cross-complaint upon B’s attorney of record in the original action. A obtained judgment against B by default and sued upon it in Texas, pleading relevant California statutes and citations of decisions of California courts. The question, raised by general demurrer to A’s complaint, was the legal effect in California of the service in the cross-action, and hence of the judgment founded upon it. Held: That this question, whether regarded as of fact or of law, is a fédéral question arising under the Full Faith and Crédit Clause and R. S. § 905, 28 U. S. C. 687, and its decision by the Texas court is reviewable here. P. 64. 5. Under §§ 442, 1015 and 1011 of the California Code of Civil Procedure, and decisions of the California courts, as pleaded in this case, valid service of a cross-complaint may be made upon the attorney of the plaintiff in the original action. P. 65. 60 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. The cross-complaint was for conversion of chattels, filed, with the permission of the court, in an action for goods sold and delivered. 6. There is nothing in the Fourteenth Amendment to prevent a State from adopting a procedure by which a judgment in per-sonam may be rendered in a cross-action against a plaintiff in its courts, upon service of process or of appropriate pleading upon his attorney of record. P. 67. 101 S. W. (2d) 1046, reversed. Certiorari, 302 U. S. 668, to review the affirmance of a judgment dismissing a suit brought in Texas by the assignée of a judgment recovered, on cross-complaint, in California against a Texas corporation. The Texas suit was against the directors of the corporation, as trustées in dissolution, and against the stockholders, as transférées of corporate assets. The Suprême Court of Texas having refused a writ of error for want of jurisdiction, the writ of this Court ran to the Court of Civil Appeals. Mr. M. G. Adams for petitioner. Mr. Oliver J. Todd submitted on brief for respondents. Mr. Justice Stone delivered the opinion of the Court. The question for decision is whether the action, in this case, of the Texas state courts, in dismissing a suit founded upon a judgment of the superior court of California, denied to the judgment the faith and crédit which the Constitution commands. Petitioner, as assignée of a California judgment against the Beaumont Export & Import Company, a Texas corporation, brought the présent suit in the Texas state district court against respondents, directors of the corporation acting as its trustées in dissolution, and against its stockholders as transférées of corporate assets, to collect the judgment. His pétition sets out in detail the circum-stances attending the rendition of the California judg- 59 ADAM v. SAENGER. Opinion of the Court. 61 ment and incorporâtes by reference a duly attested copy of the judgment roll. It appears. that the corporation brought suit in the Superior Court of California, a court of general jurisdic-tion, against Montes, petitioner’s predecessor in interest, to recover a money judgment for goods sold and delivered. Thereupon Montes, following what is alleged to be the California practice, with leave of the court brought a cross-action against the corporation, by service of a cross-complaint upon the corporation’s attorney of record in the pending suit, to recover for the conversion of chattels. Judgment in the cross-action, taken by default, was fol-lowed by dismissal of the corporation’s suit and is the judgment which is the subject of the présent suit. A motion to open the default and to be allowed to defend, made later on behalf of the corporation, was contested and was denied by the court, the issue being whether the cross-complaint was in fact served on the plaintiff’s attorney. The trial court sustained a general demurrer to the complaint and gave judgment dismissing the cause, which the Court of Appeals affirmed, 101 S. W. (2d) 1046. Pétition to the Texas suprême court for a writ of error was denied for want of jurisdiction. We granted certiorari, cf. Bain Peanut Co. v. Pinson, 282 U. S. 499, the question being an important one of constitutional law. Our writ is prop-erly directed to the Court of Civil Appeals, it being the highest court of the State in which a judgment could be had. Bacon v. Texas, 163 U. S. 207, 215; Sullivan v Texas, 207 U. S. 416; San Antonio & A. P. Ry. Co. v. Wagner, 241 U. S. 476; American Raïlway Express Co. v. Levee, 263 U. S. 19. The Court of Civil Appeals rested its decision on a single ground, want of jurisdiction of the California court over the corporation in the cross-action in which the judg-ment was rendered. Construing the California statutes 62 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. and decisions which the complaint set out, it concluded that they did not authorize service of the complaint in the cross-action upon the plaintifï’s attorney of record. It held further that in any case as the corporation was not présent within the state no jurisdiction could be ac-quired over it by the substituted service, and the California judgment was consequently without due process and a nullity beyond the protection of the full faith and crédit clause. To review these rulings we brought the case here. Cf. Ward v. Love County, 253 U. S. 17, 25; Indiana ex rel. Anderson n. Brand, post, p. 95. By R. S. § 905, 28 U. S. C. 687, enacted under authority of the full faith and crédit clause, Art. IV, § 1 of the Constitution, the duly attested record of the judgment of a state is entitled to such faith and crédit in every court within the United States as it has by law or usage in the state from which it is taken. If it appears on its face to be a record of a court of general jurisdiction, such jurisdiction over the cause and the parties is to be pre-sumed unless disproved by extrinsic evidence, or by the record itself. Hanley v. Donoghue, 116 U. S. 1 ; Knowles v. Gaslight & Coke Co., 19 Wall. 58; Settlemier v. Sullivan, 97 U. S. 444. But in a suit upon the judgment of another state the jurisdiction of the court which rendered it is open to judicial inquiry, Chicago Life Insurance Co. v. Cherry, 244 U. S. 25, and when the matter of fact or law on which jurisdiction dépends was not litigated in the original suit it is a matter to be adjudicated in the suit founded upon the judgment. Thompson v. Whitman, 18 Wall. 457. Here the fact of the service of the complaint upon the attorney is alleged by the petitioner and admitted by the demurrer, but the court’s conclusion that the California court was without jurisdiction, resting in part upon its construction of the California statute, présents an issue not litigated in the California suit which must be determined in the présent one. 59 ADAM v. SAENGER. Opinion of the Court. 63 Congress has not prescribed the manner in which the legal effect of the judgment and the proceedings on which it is founded in the state where rendered are to be ascer-tained by the courts of another state. It has left that to the applicable procedure of the courts in which they are drawn in question. Where they are in issue this Court, in the exercise of its appellate jurisdiction to review cases coming to it from state courts, takes judicial notice of the law of the several States to the same extent that such notice is taken by the court from which the appeal is taken. “Whatever is matter of law in the court appealed from is matter of law here, and whatever was matter of fact in the court appealed from is matter of fact here.” Hanley v. Donoghue, supra, 6. According to Texas law the legal effect of the judgment of another state, on which suit is brought, is to be determined by the court, not the jury. But a suitor who asserts that the force and effect of the judgment is different from that of a similar judgment of the courts of the state is required to allégé specifically and prove as matter of fact the particular laws or usage on which he relies to establish the différence, and on demurrer only the law or usage specifically alleged will be considered in determining whether the law of another state differs from that of Texas. Porcheler v. Bronson, 50 Tex. 555; GUI v. Everman, 94 Tex. 209 ; 59 S. W. 531 ; National Bank of Commerce v. Kenney, 98 Tex. 293; 83 S. W. 368. In the présent suit petitioner, in conformity to the state procedure, has set out in his complaint the California statutes and the citations of the decisions of California courts which he contends establish the law of that state that a cross-action in a pending suit may be begun by service of a cross-complaint upon the plaintiff’s attorney. The question thus raised upon demurrer for decision by the court is the legal effect in California of the service, and hence of the judgment founded upon it. 64 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. Whether the question be regarded as one of fact or more precisely and accurately as a question of law to be deter-mined as are other questions of law, although procédural exigencies require it to be presented by the pleading and proof, as are issues of fact, it is one arising under the Constitution and a statute of the United States which commands that such faith and crédit shall be given by every court to the California proceedings “as they hâve by law or usage” of that State. And since the existence of the fédéral right turns on the meaning and effect of the California statute, the decision of the Texas court on that point, whether of law or of fact, is reviewable here. Stanley v. Schwdlby, 162 U. S. 255, 274, 277-279; Southern Pacific Co. v. Schuyler, 227 U. S. 601, 611; Creswill v. Knights of Pythias, 225 U. S. 246, 261; Ancient Egyptian Order v. Michaux, 279 U. S. 737, 744-746; Norris v. Alabama, 294 U. S. 587, 590; see Northern Pacific R. Co. v. North Dakota, 236 U. S. 585, 593; cf. Union Pacific R. Co. v. Public Service Comm’n, 248 U. S. 67, 69; Ward v. Love County, supra, 22; Truax N. Corrigan, 257 U. S. 312, 324; Davis v. Wechsler, 263 U. S. 22, 24; Patterson v. Alabama, 294 U. S. 600, 602. While this Court réexamines such an issue with def-erence after its détermination by a State court, it can-not, if the laws and Constitution of the United States are to be observed, accept as final the decision of the State tribunal as to matters alleged to give rise to the asserted fédéral right. This is especially the case where the decision is rested, not on local law or matters of fact of the usual type, which are peculiarly within the cognizance of the local courts, but upon the law of another state, as readily determined here as in a State court. Huntington v. Attrill, 146 U. S. 657, 684; Yar-borough v. Yarborough, 168 S. C. 46; 166 S. E. 877; 290 U. S. 202. In ruling that the service in the California suit was unauthorized, the Court of Civil Appeals said: 59 ADAM v. SAENGER. Opinion of the Court. 65 “The cross action was not an ancillary proceeding, but an independent suit in which a final judgment could be rendered without awaiting a decision in the( original suit. Farrar v. Steensburg, 173 Çal. 94, 159 Pac. 707. It is well settled in this State that a cross action occu-pies the attitude of an independent suit and requires service of the cross action upon the cross défendant. Harris v. Schlinke, 95 Tex. 88. This being so, in the absence of a waiver of service, or an appearance by the cross de-fendant, personal service on the cross défendant must be had to confer jurisdiction upon the court to détermine the matter and render judgment in the case.” But the question presented by the pleadings is the status of a cross-action under the California statutes, not under those of Texas. We think its status is adequately dis-closed by the California statutes and decisions pleaded by petitioner, and is that for which he contends. Section 442 of the California Code of Civil Procedure specifically provides that a défendant may secure affirmative relief upon “cross-complaint” which “must be served upon the parties affected thereby,” and requires service of “summons upon the cross-complaint” only upon such parties as “hâve not appeared in the action.” 1 Arguing that “action” means only “cross-action” and not the original action brought by the plaintiff, the Texas court con- luWhenever the défendant seeks affirmative relief against any party, relating to or depending upon the contract, transaction, matter, happening or accident upon which the action is brought, or affecting the property to which the action relates, he may, in addition to his answer, file at the same time, or by permission of the court subsequently, a cross-complaint. The cross-complaint must be served upon the parties affected thereby, and such parties may demur or answer thereto as to the original complaint. If any of the parties affected by the cross-complaint hâve not appeared in the action, a summons upon the cross-complaint must be issued and served upon them in the same manner as upon the commencement of an original action,” 53383°—38---------5 66 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. cluded that a plaintiff who has not appeared in the cross-action must be served with summons “as upon the commencement of an original action.” But the word “action,” even if susceptible of such meaning, cannot be so interpreted in the face of the pleaded California decisions which hold that a cross-complaint may be served on the attorney of one who is already a party to the original action. FarrarN. Steenbergh, 173 Cal. 94; 159 P. 707; Wood v. Johnston, 8 Cal. App. 258; 96 P. 508; Ritter n. Braash, 11 Cal. App. 258; 104 P. 592. Section 1015 provides that in ail cases where a party, whether résident or non-resident, has an attorney in an action, “the service of papers, when required, must be upon the attorney instead of the party, except service of subpoenas, of writs and other process issued in the suit, and of papers to bring him into contempt.” 2 The Court of Civil Appeals construed this section as requiring “service of subpoenas, of writs, and other process issued in the suit” upon the party rather than the attorney, and as including the cross-complaint in the terms “writ” and “process.” But assuming that a cross-complaint served without summons may be so characterized, it is clear that the section does not by its terms preclude valid service 1 “When a plaintiff or a défendant, who has appeared, résides ont of the State, and has no attorney in the action or proceeding, the service may be made on the clerk or on the justice where there is no clerk, for him. But in ail cases where a party has an attorney in the action or proceeding, the service of papers, when required, must be upon the attorney instead of the party, except service of subpenas, of writs, and other process issued in the suit, and of papers to bring him into contempt. If the sole attorney for a party is removed or suspended from practice, then the party has no attorney within the meaning of this section. If his sole attorney has no known office in this State, notices and papers may be served by leaving a copy thereof with the clerk of the court or with the justice where there is no clerk, unless such attorney shall hâve filed in the cause an address of a place at which notices and papers may be served on him, in which event they may be served at such place.” 59 ADAM v. SAENGER. Opinion of the Court. 67 of the cross-complaint upon the attorney for a party which, as we hâve seen, § 442 permits. Section 1015 directs service upon the attorney of ail but the three types of papers excepted, but says nothing as to the effec-tiveness of service of those papers upon him. Section 1011, set out in the pleading though not referred to in the court’s opinion, reads, “Notices and papers, when and how served. The Service may be personal, by deliv-ery to the party or attorney on whom the service is required to be made. . . The question whether § 1015 does forbid service of a cross-complaint on the attorney has been definitely an-swered in the négative by the Suprême Court of California, which, in Farrar v. Steenbergh, supra, 97, held, “Service of a cross-complaint upon a plantiff who appears by an attorney is not made by a summons to the plaintiff, but by delivery of a copy of the cross-complaint to the attorney.” Upon this ground the California District Court of Appeals, in cases on which petitioner relies, has sustained judgments taken upon default in a cross-action begun by service of the cross-complaint on the plaintiff’s attorney. Ritter v. Braash, supra; Wood n. Johnston, supra. Upon ail the pleaded evidence of the California law, to the considération of which we are restricted by the présent state of the record, we think the only infer-ence to be drawn is that the service in the California suit was authorized by California law. There is nothing in the Fourteenth Amendment to pre-vent a state from adopting a procedure by which a judgment in personam may be rendered in a cross-action against a plaintiff in its courts, upon service of process or of appropriate pleading upon his attorney of record. The plaintiff having, by his voluntary act in demanding justice from the défendant, submitted himself to the jurisdiction of the court, there is nothing arbitrary or unrea-sonable in treating him as being there for ail purposes 68 OCTOBER TERM, 1937. Syllabus. 303 U. S. for which justice to the défendant requires his presence. It is the price which the state may exact as the condition of opening its courts to the plaintiff. Frank L. Young Co. v. McNeal-Edwards Co., 283 U. S. 398, 400; cf. Chicago & N. W. Ry. Co. v. Lindell, 281 U. S. 14, 17. The judgment is reversed and the cause remanded for further proceedings not inconsistent with this opinion. Reversed. Me. Justice Cardozo took no part in the considération or decision of this case. Mr. Justice Black concurs in the resuit. COMPANIA ESPANOLA DE NAVEGACION MARI-TIMA, S. A., v. THE NAVEMAR et al. CERTIORARI TO THE CIRCUIT COURT OF APPEALS FOR THE SECOND CIRCUIT. No. 242. Argued January 7, 10, 1938.—Decided January 31, 1938. 1. A vessel of a friendly government in its possession and service is a public vessel, even though engaged in the carriage of mer-chandise for hire, and as such is immune from suit in the courts of admiralty of the United States. P. 74. 2. This immunity the friendly government may assert either through diplomatie channels or as a claimant in the courts of the United States. Id. If the claim is allowed by the executive branch of our govemment, it is then the duty of the courts to release the vessel upon appropriate suggestion by the Attorney General of the United States, or other officer acting under his direction. The foreign government is also entitled as of right upon a proper showing, to appear in a pending suit, there to assert its claim to the vessel, and to raise the jurisdictional question in its own name or that of its accredited and recognized représentative. 3. The District Court took possession of a Spanish vessel on a libel by one claiming to be the owner, who alleged wrongful dispossession by members of the crew. The Spanish Ambassador, by a 68 COMPANIA ESPANOLA v. NAVEMAR. 69 Counsel for Parties. verified suggestion, challenged the jurisdiction on the ground that the vessel, before the arrest, was a public vessel in possession of the Spanish Government and so immune from process. He also claimed that the Spanish Governmentwas owner and entitled to possession by virtue of a Spanish decree of attachment. The Department of State had refused to act in the matter and had referred the Ambassador to the courts. At a hearing upon the suggestion and reply affidavits, the District Court found that no one had taken possession in behalf of the Spanish Government, al-though endorsements had been made by Spanish consuls in foreign ports, on the ship’s roll and register stating that the ship had become the property of the Spanish State through an attachment. Héld: (1) That the Ambassador’s application was properly enter-tained. P. 75. (2) The Department of State having declined to act, the want of admiralty jurisdiction because of the alleged public status of the vessel and the right of the Spanish Government to demand possession of the vessel as owner if it so elected, were appropriate subjects for judicial inquiry upon proof of the matters alleged. Id. (3) The suggestion, though sufficient as a statement of the contentions made, was not proof of its allégations. Id. (4) The decree of attachment, being in invitum, did not dis-possess the shipowner, a taking of actual possession by some act of physical dominion or control in behalf of the Spanish Government or some act of récognition by the ship’s officers was need-ful. Id. (5) The Ambassador should be pennitted to intervene as claimant. P. 76. 90 F. (2d) 673, reversed. Certiorari, 302 U. S. 669, to review the reversai of an order of the District Court refusing leave to the Ambassador of the Republic of Spain to appear as claimant of a ship in an admiralty case. The court below deemed the Ambassador’s verified suggestion conclusive and or-dered the libel dismissed. Mr. T. Catesby Jones, with whom Messrs. D. Roger Englar, Oscar R. Houston, and James W. Ryan were on the brief, for petitioner. 70 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. Mr. Charles W. Hagen, with whom Messrs. Anthony V. Lynch, Jr., and Horace T. Atkins were on the brief, for the Spanish Ambassador, respondent in this Court. Mr. Justice Stone delivered the opinion of the Court. In a suit in admiralty, brought in a district court by the alleged owner to recover possession of a Spanish mer-chant vessel, the Spanish Ambassador asked leave to in-tervene as claimant on the basis of an affidavit of the Spanish Acting Consul General suggesting that when the suit was brought the vessel was the property of the Republic of Spain, by virtue of a decree of attachment pro-mulgated by the President of the Republic, appropriating the vessel to the public use, and that it was then in the possession of the Spanish Government. The principal question for decision is whether it was the duty of the court, upon présentation of the suggestion, to dismiss the libel for want of admiralty jurisdiction. Petitioner, a Spanish corporation, brought the présent suit in admiralty in the district court for eastern New York against the Spanish steamship “Navemar,” five members of her crew, and ail persons claiming an interest in her, to recover possession of the vessel. The libel alleged that petitioner was owner of the vessel, which was within the territorial jurisdiction of the court; and that while she was in petitioner’s possession the individual re-spondents, acting as a committee of the crew, had wrong-fully and forcibly seized, and had since retained possession of the vessel. After hearing evidence in support of the pétition, the district court rendered its decree upon de-fault, directing the marshal to place libelant in possession. Thereupon the Spanish Ambassador filed a suggestion in the cause, challenging the jurisdiction of the court on the ground that the “Navemar” was a public vessel of the Republic of Spain, not subject to judicial process of the court, and asking that it direct delivery of the 68 COMPANIA ESPANOLA v. NAVEMAR. 71 Opinion of the Court. vessel to the Spanish Acting Consul General in New York. The suggestion alleged that when the suit was brought the “Navemar” was the property of the Spanish Government by virtue of its decree of October 10, 1936, and was in the possession of the Republic of Spain. The district court issued its order to show cause why the default should not be opened and the Ambassador per-mitted to appear specially as claimant of the vessel. After a hfearing the court denied the application but with leave to the Ambassador to make further application upon fuller présentation of the facts showing the ownership and possession of the vessel by the Spanish Government. Meanwhile the Department of State had refused to act upon the Spanish Government’s claim of possession and ownership of the “Navemar,” had declined to honor the request of the Ambassador that représentations be made in the pending suit by the Attorney General of the United States in behalf of the Spanish Government, and had advised the Ambassador that his Government was entitled “to appear directly before the court in a case of this character.” A second application by the Ambassador for leave to appear as a claimant upon a verified suggestion, stating additional circumstances relied upon to establish possession of the vessel by the Republic of Spain, was denied. 18 F. Supp. 153. On appeal the Court of Appeals for the Second Circuit, after restricting the appeal to the order of the district court on the second application, reversed that order and directed that the libel be dis-missed. 90 F. (2d) 673. We granted certiorari, because the case is of public importance and because of alleged conflict of the decision below with our decision in The Pesaro, 255 U. S. 216, and with that of the Court of Appeals for the Fourth Circuit in The Attuatita, 238 Fed. 909. Respondent’s suggestion on the second application pre-sented two contentions: one, a challenge to the jurisdic- 72 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. tion on the ground that the “Navemar” was a public vessel, immune from arrest and process of the court; the other, that the Spanish Government was owner of the vessel and entitled to her possession by virtue of the decree of attachment. In addition to the general allégations of ownership and possession of the vessel by the Spanish Government in the first application, the suggestion in the second set up the acquisition of possession in behalf of the* Spanish Government by spécifie acts of its consular officers in Argentina and in New York. It alleged that on October 26, 1936, the Spanish Consul at Rosario, Argentina, had endorsed on the ship’s roll a statement that “Through a cable dated 26 of the inst month from the Director General of the Merchant Marine this ship has become the property of the State through attachment according to the Decree of Oct. 10, 1936,” and that on October 28 the Spanish Acting Consul General at Buenos Aires had made a similar endorsement on the ship’s register. It was also alleged that on arrivai in New York in November the Spanish Acting Consul General at that port, by direction of the Ambassador, had instructed the master of the "Navemar” “to await and abide further instructions . . . as regards any further use of the” vessel, and that on November 28 he had instructed the master to render a detailed account of the expenses of the “Navemar” and of minor repairs that she might require. There was no averment that the alleged seizure by the members of the crew was an act of or in behalf of the Spanish Government. The district court allowed a full hearing upon the suggestion and upon reply affidavits submitted by libelant, in the course of which there was opportunity for the parties to présent proof of ail the relevant facts. Cf. Ex parte New York, 256 U. S. 503. The court found that no one had taken possession of the “Navemar” in behalf COMPANIA ESPANOLA v. NAVEMAR. 73 Opinion of the Court. 68 of the Spanish Government. It pointed ont that neither the ship’s roll nor its register is a document of title or possession, the ship’s roll being merely a record, in the case of Spanish vessels usually deposited with the Spanish consul while in port, showing arrivais and sailings of the vessel, the kind of cargo carried, the list of passengers, and the enrolhnent of the members of the crew, and the ship’s register being only a record of the nationality of the vessel as determined by the place of her home port. It found that none of the consular officers mentioned had done any act purporting to take possession of the vessel; that none of them had informed the master that he wished to take possession or had any intention of doing so; that the vessel had proceeded under command of her master upon her voyage from Buenos Aires to New York, manned by officers and crew in the employ of petitioner; that upon arrivai, the master, under direction of the ship’s agent, had discharged cargo; and that before discharge the freight money was paid by the consignées to the agents of the time charterer in New York. The district court, upon this and other evidence not necessary to detail, concluded that the “Navemar” was nevër in possession of the Spanish Government before her seizure by the members of the crew in the territorial waters of the United States, and that she was not a vessel in the public service of the Spanish Government. The Court of Appeals, without reviewing the findings of the district court, or the evidence, adverted to the allégation of the first suggestion, substantially repeated on information and belief in the second, that the Spanish Consul at Rosario “pursuant to instructions from the Di-rector General of the Spanish Merchant Marine, took possession of the . . . Navemar in the name of the Republic of Spain . . . whereby the . . . Navemar then and there became and at ail times since has remained the property of the Government of the Republic of Spain.” 74 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. Declaring that the court was bound to accept this allégation as conclusive, it held that the vessel must be taken to be a public vessel owned by and in the possession of the Spanish Government, and as such immune from suit in the courts of the United States. This we think was a mistaken view of the force and effect of the suggestion. Admittedly a vessel of a friendly govemment in its possession and service is a public vessel, even though engaged in the carriage of merchandise for hire, and as such is immune from suit in the courts of admiralty of the United States. Berizzi Bros. Co. v. The Pesaro, 271 U. S. 562; cf. The Exchange, 7 Cranch 116. And in a case such as the présent it is open to a friendly government to assert that such is the public status of the vessel and to claim her immunity from suit, either through diplomatie channels or, if it chooses, as a claimant in the courts of the United States. If the claim is recognized and allowed by the executive branch of the government, it is then the duty of the courts to release the vessel upon appropriate suggestion by the Attorney General of the United States, or other officer acting under his direction. The Cassius, 2 Dali. 365; The Exchange, supra; The Pizarro, 19 Fed. Cas., No. 11,199; see The Constitution, L. R. 4 P. D. 39; cf. Ex parte Muir, 254 U. S. 522; The Parlement Belge, L. R. 4 P. D. 129. The foreign government is also entitled as of right upon a proper showing, to appear in a pending suit, there to assert its claim to the vessel, and to raise the jurisdictional question in its own name or that of its accredited and recognized représentative. The Sapphire, 11 Wall. 164, 167; The Anne, 3 Wheat. 435, 445-446; The Santissima Trinidad, 7 Wheat. 283, 353; Colombia N. Cauca Co., 190 U. S. 524; Ex parte Transportes Maritimes, 264 U. S. 105; Berizzi Bros. Co. v. The Pesaro, supra. After refusai of the Secretary of State to act upon the présent claim, the Ambassador adopted the latter course. COMPANIA ESPANOLA v. NAVEMAR. 75 68 Opinion of the Court. His application to be permitted to appear and présent the daim was properly entertained by the district court. But it was not bound, as the Court of Appeals thought, to accept the allégations of the suggestion as conclusive. The Department of State having declined to act, the want of admiralty jurisdiction because of the alleged public status of the vessel and the right of the Spanish Government to demand possession of the vessel as owner if it so elected, were appropriate subjects for judicial inquiry upon proof of the matters alleged. But the filed suggestion, though sufficient as a state-ment of the contentions made, was not proof of its allégations. This Court has explicitly declined to give such a suggestion the force of proof or the status of a like suggestion coming from the executive department of our government. Ex parte Muir, supra; The Pesaro, supra. Berizzi Bros. Co.v. The Pesaro, supra, did not hold other-wise for there it was stipulated that the vessel, when ar-rested, was owned, possessed and controlled by a foreign government and used by it in carrying merchandise for hire. The sole question was one of law, whether, upon the facts stipulated, the vessel was immune from suit. The district court concluded, rightly we think, that the évidence at hand did not support the claim of the suggestion that the “Navemar” had been in the possession of the Spanish Government. The decree of attachment, with-out more, did not operate to change the possession which, before the decree, was admittedly in petitioner. To ac-complish that resuit, since the decree was in invitum, actual possession by some act of physical dominion or control in behalf of the Spanish Government, was needful, The Davis, 10 Wall. 15, 21 ; Long v. The Tampico, 16 Fed. 491, 493, 494; The Attualita, supra; The Carlo Poma, 259 Fed. 369, 370, reversed on other grounds, 255 U. S. 219, or at least some récognition on the part of the ship’s officers that they were controlling the vessel and crew in 76 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. behalf of their government.1 Both were lacking, as was support for any contention that the vessel was in, fact employed in public service. See Long v. The Tampico, supra, 493, 494; cf. Berizzi Bros. Co. N. The Pesaro, supra. The district court rightly declined to treat the suggestion as conclusive or sufficient as proof to require the court to relinquish its jurisdiction. But as the suggestion was tendered in support of an application to appear as a claimant in the suit, and as it put forth a claim to title and right to possession of the vessel, the Ambassador should hâve been permitted to intervene and, if so advised, to litigate its claims in the suit. In Ex parte Muir, supra, and in The Pesaro, supra, 219, the Ambassador of the intervening government challenged the jurisdiction of the court, but did not place himself or his Government in the attitude of a suitor. Here the application as construed by the trial court was for permission to intervene as a claimant. We think the applicant should be permitted to occupy that position if so advised. The decree of the Court of Appeals will be reversed. The respondent will be permitted to intervene for the purpose of asserting the Spanish Government’s ownership and right to possession of the vessel, and the order of the district court will be 'modified accordingly. Reversed. Mr. Justice Cardozo took no part in the considération or decision of this case. 1In The Jupiter, 1924 P. 236, 241, 244 (cf. The Jupiter No. 2, 1925 P. 69; The Jupiter No. 3, 1927 P. 122, 125), and in the recently reported The Cristina, 59 Lloyd’s List Law Reports 43, 50, on which respondent relies, the possession taken in behalf of the claimant government was actual. The judgment in The Cristina appears to hâve proceeded on that ground. In The Jupiter, it appeared that before the suit was brought the master had repudiated the possession and ownership of the plaintiffs and held the vessel for the claimant government. The report of The Cristina in the Admiralty Division, 59 Lloyd’s List Law Reports 1, 3, indicates that the master and crew were in the pay of the Spanish Government. CONN. GENERAL CO. v. JOHNSON. Counsel for Parties. 77 CONNECTICUT GENERAL LIFE INSURANCE CO. v. JOHNSON, TREASURER OF CALIFORNIA. APPEAL FROM THE SUPREME COURT OF CALIFORNIA. No. 316. Argued January 14, 1938.—Decided January 31, 1938. 1. A corporation which is allowed to corne into a State and there carry on its business may claim, as an individual may claim, the protection of the Fourteenth Amendment against a subséquent application to it of state law. P. 79. 2. A Connecticut corporation conducted part of its life insurance business in California under license from that State and also entered into contracts with other insurance corporations like-wise licensed to do business in California, reinsuring them against loss on policies of life insurance effected by them in California and issued to residents there. These reinsurance contracts were entered into in Connecticut, where the premiums were paid and where the losses, if any, were payable. Héld that, as applied to such reinsurance business, a California tax on the privilège of the corporation to do business within the State, measured by the gross premiums received, was void under the due process clause of the Fourteenth Amendment. Pp. 78, 82. 3. A State may not tax the property and activities of a foreign corporation which are not within its boundaries. P. 80. The limits placed by the Fourteenth Amendment on the State’s jurisdiction to tax are to be ascertained by reference to the incidence of the tax upon its objects rather than the ultimate thrust of the économie benefits and burdens of transactions within the State which it might but does not tax. - 93 Cal. Dec. 4650; 67 P. 2d 675, reversed. Appeal from judgments affirming the dismissal on demurrer of two actions by the above-named insurance company against Johnson, State Treasurer of California, to recover taxes paid under protest. The cases were heard together in the court below. Messrs. William Marshall Bullitt and B. M. Anderson, with whom Mr. Raymond Benjamin was on the brief, for appellant. 78 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. Mr. Neil Cunningham, Deputy Attorney General, with whom Mr. U. S. Webb, Attorney General, of California, was on the brief, for appellee. Mr. Justice Stone delivered the opinion of the Court. Appellant is a Connecticut corporation, admitted to do an insurance business in California. In addition to its business conducted within that state it has entered into contracts with other insurance corporations likewise li-censed to do business in California, reinsuring them against loss on policies of life insurance effected by them in California and issued to residents there. These rein-surance contracts were entered into in Connecticut where the premiums were paid and where the losses, if any, were payable. The question for decision is whether a tax laid by California on the receipt by appellant in Connecticut of the reinsurance premiums during the years 1930 and 1931, infringes the due process clause of the Fourteenth Amendment. In suits brought in the state court by appellant against respondent, state treasurer, to recover the taxes paid, the Suprême Court of California sustained demurrers to the complaints and gave judgments for the respondent. The cases, having been Consolidated, corne here on a single ap-peal under § 237 (a) of the Judicial Code. 28 U. S. C. § 344 (a). Section 14 of Art. XIII of the California constitution, as supplemented by Act of March 5, 1921 (Stats. 1921, c. 22, pp. 20, 21, Political Code, § 3664b), fixing the rate of tax, lays upon every insurance company doing business within the state an annual tax of 2.6% “upon the amount of the gross premiums received upon its business done in this state, less return premiums and reinsurance in companies or associations authorized to do business in this state. . . .” The Suprême Court of California has declared that the constitutional provision imposes 77 CONN. GENERAL CO. v. JOHNSON. Opinion of the Court. 79 “a franchise tax exacted for the privilège of doing business” in the state. Consolidated Title Securities Co. v. Hopkins, 1 Cal. (2d) 414, 419; 35 P. (2d) 320; cf. Carpenter v. People’s Mutual Life Insurance Co., 94 Cal. Dec. 674; 74 P. (2d) 708. Although in terms the “gross premiums received upon . . . business done in this state,” less the specified déductions, are made the measure of the tax, the state court in this, as in an earlier case, Connecticut General Life Insurance Co. v. Johnson, 3 Cal. (2d) 83; 43 P. (2d) 278 (appeal dismissed for want of a properly presented fédéral question, 296 U. S. 535), has held that the measure includes the premiums on appellant’s reinsurance policies effected and payable in Connecticut. In this case it has declared also that the policy of the state, expressed in the constitutional provision, is “to avoid double taxation without any loss of revenue to the state.” To accomplish that end the déduction of reinsurance premiums paid to companies authorized to do business within the state is allowed, it is said, on the theory that the benefit of the déduction will be passed on to the reinsurer who, being authorized to do business within the state, may be taxed on the reinsurance premiums as a means of equalizing the tax and as an offset against the benefit of the déduction which he ultimately enjoys. No contention is made that appellant has consented to the tax imposed as a condition of the granted privilège to do business within the state. Nor could it be, for it appears that appellant had conducted its business in California under state license for many years before the taxable years in question and before the taxing act was construed by the highest court of the state, in Connecticut General Life Insurance Co. v. Johnson, supra, to apply to premiums received in Connecticut from reinsurance con-tracts effected there. A corporation which is allowed to corne into a state and there carry on its business may 80 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. daim, as an individual may daim, the protection of the Fourteenth Amendment against a subséquent application to it of state law. Hanover Fire Insurance Co. v. Harding, 272 U. S. 494; cf. Kentucky Finance Corp. v. Paramount Auto Exchange Corp., 262 U. S. 544. It is said that the state could hâve lawfully accom-plished its purpose if the statute had further stipulated that the déduction should be allowed only in those cases where the reinsurance is effected in the state or the rein-surance premiums paid there. But as the state has placed no such limitation on the allowance of déductions, the end sought can be attained only if the receipt by appellant of the reinsurance premiums paid in Connecticut upon the Connecticut policies is within the reach of California’s taxing power. Appellee argues that it is, because the reinsurance transactions are so related to business carried on by appellant in California as to be a part of it and properly included in the measure of the tax; and because, in any case, no injustice is done to appellant since the effect of the statute as construed is to redistribute the tax, which the state might hâve exacted from the original insurers but did not, by assessing it upon appellant to the extent to which it has received the benefit of the allowed déductions. But the limits of the state’s legislative jurisdiction to tax, prescribed by the Fourteenth Amendment, are to be ascertained by reference to the incidence of the tax upon its objects rather than the ultimate thrust of the économie benefits and burdens of transactions within the state. As a matter of convenience and certainty, and to secure a practically just operation of the constitutional prohibition, we look to the state power to control the objects of the tax as marking the boundaries of the power to lay it. Hence it is that a state which Controls the property and activities within its boundaries of a foreign corporation admitted to do business there may tax them. But the due process clause déniés to the state 77 CONN. GENERAL CO. v. JOHNSON. Opinion of the Court. 81 power to tax or regulate the corporation’s property and activities elsewhere. Union Refrigerator Transit Co. N. Kentucky, 199 U. S. 194; New York Life Insurance Co. v. Head, 234 U. S. 149; New York Life Insurance Co. v. Dodge, 246 U. S. 357; St. Louis Compress Co. v. Arkansas, 260 U. S. 346; Compania General De Tabacos v. Col-lector, 275 U. S. 87; Home Insurance Co. v. Dick, 281 U. S. 397; Hartford Accident Æ Indemnity Co. v. Delta & Pine Land Co., 292 U. S. 143; Boseman v. Connecticut General Life Ins. Co., 301 U. S. 196; People ex rel. Sea Insurance Co. v. Graves, 274 N. Y. 312; 8 N. E. (2d) 872; cf. Provident Savings Life Assurance Society v. Kentucky, 239 U. S. 103. It follows that such a tax, otherwise unconstitutional, is not converted into a valid exaction merely because the corporation enjoys outside the state économie benefits from transactions within it, which the state might but does not tax, or because the state might tax the transactions which the corporation carries on outside the state if it were induced to carry them on within. Appellant, by its reinsurance contracts, undertook only to indemnify the insured companies against loss upon their policies written in California. The reinsurance in-volved no transactions or relationship between appellant and those originally insured, and called for no act in California. Connecticut General Life Insurance Co. N. Johnson, supra, 87; cf. Morris & Co. v. Skandinavia Insurance Co., 279 U. S. 405, 408. Apart from the facts that appellant was privileged to do business in California, and that the risks reinsured were originally insured against in that state by companies also authorized to do business theré, California had no relationship to appellant or to the reinsurance contracts. No act in the course of their formation, performance or discharge, took place there. The performance of those acts was not dépendent upon any privilège or authority granted by it, and California laws afforded to them no protection, 53383°—3$---------6 82 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. The grant by the state of the privilège of doing business there and its conséquent authority to tax the privilège do not withdraw from the protection of the due process clause the privilège, which California does not grant, of doing business elsewhere. Western Union Tele-graph Co. v. Kansas, 216 U. S. 1 ; International Paper Co. v. Massachusetts, 246 U. S. 135; Louisville & Jefferson-ville Ferry Co. v. Kentucky, 188 U. S. 385, 398. Even though a tax on the privilège of doing business within the state in insuring residents and risks within it may be measured by the premiums collected, including those mailed to the home office without the state, Equitable Life Assurance Society v. Pennsylvania, 238 U. S. 143, and though the writing of policies without the state insuring residents and risks within it is taxable because within the granted privilège, Compania General De Tabacos v. Col-lector, supra, 98, there is no basis for saying that rein-surance which does not run to the original insured, and which from its inception to its termination involves no action taken within California, even the settlement and adjustment of daims, is embraced in any privilège granted by that state. Provident Savings Life Assurance Society v. Kentucky, supra, 112; Compania General De Tabacos v. Collector, supra, 96; cf. Equitable Life Assurance Society v. Pennsylvania, supra, 147; Compania General De Tabacos v. Collector, supra, 98. Ail that ap-pellant did in effecting the reinsurance was done without the state and for its transaction no privilège or license by California was needful. The tax cannot be sustained either as laid on property, business done, or transactions carried on within the state, or as a tax on a privilège granted by the state. Reversed. Mr. Justice Cardozo took no part in the considération or decision of this case. CONN. GENERAL CO. v. JOHNSON. 83 77 Black, J., dissenting. Mr. Justice Black, dissenting. I do not believe that this California corporate franchise tax has been proved beyond ail reasonable doubt to be in violation of the Fédéral Constitution1 and I believe that the judgment of the Suprême Court of California should be affirmed. Traditionally, States hâve been empowered to grant or deny foreign corporations the right to do business within their borders,2 and . . may exclude them arbitrarily or impose such conditions as . . . (they) will upon their engaging in business within (their) . . . jurisdiction.”3 California laid an annual tax upon gross Insurance premiums which the Suprême Court of California has construed to be “a franchise tax exacted for the privilège of doing business.” In measuring this franchise tax imposed upon corporations the state includes reinsurance premiums paid to the corporation on contracts made without the state, where such reinsurance protects citizens of the State of California. There is no attempt by this tax to regulate the business of the Insurance company in any state except California. The record does not indicate that California made any contract with this Connecticut corporation guaranteeing it a permanent franchise to do business in California on the same terms and conditions upon which it entered the state. “A state which freely granted the corporate privilège for intrastate commerce may change its policy. ... in the absence of contract, there is no vested interest which requires the continuance of a legislative policy however 1 Cf. Ogden v. Saunders, 12 Wheat. 213, 270. 2 Bank of Augusta v. Earle, 13 Pet. 519; Paid v. Virginia, 8 Wall. 168; Ducat v. Chicago, 10 Wall. 410; Horn Silver Mining Co. v. New York, 143 U. S. 305. 8 Hanover Pire Ins. Co. v. Harding, 272 U. S. 494, 507. 84 OCTOBER TERM, 1937. Black, J., dissenting. 303 U. S. expressed—whether embodied in a charter or in a System of taxation.” 4 It may be that California believes that by this tax it can stimulate the reinsurance business of companies making their reinsurance contracts in California. The right of a state to foster its own domestic industries by its taxing System has been sustained by this Court.6 This Court has also frequently sustained the right of a state to impose conditions on foreign corporations in order to favor its own corporations.6 If a state did not hâve this privilège it could not protect the domestic business of its own corporations from undesirable compétition by foreign corporations. The State of California has the constitutional right to limit the privilèges of its own corporations and to reserve the right to control their privilèges and to define and limit their activities.7 If California has the lawful constitutional right (as this Court has many times said it has) to impose conditions upon foreign corporations so as to protect domestic corporations, its own elected legislative représentatives should be the judges of what is reasonable and proper in a democracy. With reference to a corporate tax imposed by the State of Louisiana, this Court has said: “The appellants, by incorporating in some other state, or by spreading their business and activities over other States, cannot set at naught the public policy of Louisiana [California?]. . . . The policy Louisiana [California?] is free to adopt with 4Brandeis, J., dissenting, Liggett Co. v. Lee, 288 U. S. 517, 546. 8 New York v. Roberts, 171 U. S. 658; Magnano Co. v. Hamilton, 292 U. S. 40; Fox v. Standard OU Co., 294 U. S. 87; Aero May-flower Transit Co. v. Georgia Commission, 295 U. S. 285; Alaska Fish Co. v. Smith, 255 U. S. 44, 48. * Prudential Insurance Co. v. Cheek, 259 U. S. 530, 536; Pembina Mining Co. v. Pennsylvania, 125 U. S. 181, 189. 1 Fijth Avenue Coach Co. v. New York, 221 U. S. 467; Stone v. Mississippi, 101 U. S. 814, 820. 77 CONN. GENERAL CO. v. JOHNSON. Black, J., dissenting. 85 respect to the business activities of her own citizens she may apply to the citizens of other states who conduct the same business within her borders, and this irrespective of whether the evils requiring régulation arise solély from operations in Louisiana [California?] or are in part the resuit of extra-state transactions.” 8 But it is contended that the due process clause of the Fourteenth Amendment prohibits California from deter-mining what terms and conditions should be imposed upon this Connecticut corporation to promote the wel-fare of the people of California. I do not believe the word “person” in the Fourteenth Amendment includes corporations. ♦ “The doctrine of stare decisis, however appropriate and even necessary at times, has only a limited application in the field of con-stitutional law.” 9 This Court has many times changed its interprétations of the Constitution when the conclusion was reached that an improper construction had been adopted.19 Only recently the case of West Coast Hôtel Co. v. Parrish, 300 U. S. 379, expressly overruled a previ-ous interprétation of the Fourteenth Amendment which had long blocked state minimum wagé législation. When a statute is declared by this Court to be unconstitutional, the decision until reversed stands as a barrier against the adoption of similar législation. A constitutional interprétation that is wrong should not stand. I believe this Court should now overrule previous decisions which interpreted the Fourteenth Amendment to include corporations. Neither the history nor the language of the Fourteenth Amendment justifies the belief that corporations are in- 8 Atlantic & Pac. Tea Co. v. Grosjean, 301 U. S. 412, 427. * Stone and Cardozo, JJ., concurring, St. Joseph Stock Yards Co. v. United States, 298 U. S. 38, 94. “See collection of cases, Notes 1, 2, 3 and 4, Dissenting Opinion of Justice Brandeis, Burnet v. Coronado Oil & Gas Co., 285 U. S. 393, 406-409. 86 OCTOBER TERM, 1937. Black, J., dissenting. 303 U. S. cluded within its protection. The historical purpose of the Fourteenth Amendment was clearly set forth when first considered by this Court in the Slaughter House Cases, 16 Wall. 36, decided April, 1873—less than five years after the proclamation of its adoption. Mr. Justice Miller speaking for the Court said (p. 70) : “Among the first acts of législation adopted by several of the States in the legislative bodies which claimed to be in their normal relations with the Fédéral government, were laws which imposed upon the colored race onerous disabilities and burdens, and curtailed their rights in the pursuit of life, liberty, and property to such an extent that their freedom was of little value, while they had lost the protection which they had received from their former owners from motives both of interest and humanity. . . . “These circumstances, whatever of falsehood or miscon-ception may hâve been mingled with their présentation, forced . . . the conviction that something more was necessary in the way of constitutional protection to the unfortunate race who had suffered so much. . . . [Con-gressional leaders] accordingly passed through Congress the proposition for the fourteenth amendment, and . . . declined to treat as restored to their full participation in the government of the Union the States which had been in insurrection, until they ratifîed that article by a formai vote of their legislative bodies.” Certainly, when the Fourteenth Amendment was sub-mitted for approval, the people were not told that the States of the South were to be dpnied their normal rela-tionship with the Fédéral Government unless they rati-fied an amendment granting new and revolutionary rights to corporations. This Court, when the Slaughter House Cases were decided in 1873, had apparently dis-covered no such purpose. The records of the time can be searched in vain for evidence that this Amendment was adopted for the benefit of corporations. It is true 77 CONN. GENERAL CO. v. JOHNSON. Black, J., dissenting. 87 that in 1882, twelve years after its adoption, and ten years after the Slaughter House Cases, supra, an argument was made in this Court that a journal of the joint Congressional Committee which framed the Amendment, secret and undisclosed up to that date, indicated the Com-mittee’s desire to protect corporations by the use of the word “person.” 11 Four years later, in 1886, this Court in the case of Santa Clara County v. Southern Pacific Rail-road, 118 U. S. 394, decided for the first time that the word “person” in the Amendment did in some instances include corporations. A secret purpose on the part of the members of the Committee, even if such be the fact, however, would not be sufficient to justify any such construction. The history of the Amendment proves that the people were told that its purpose was to protect weak and helpless human beings and were not told that it was intended to remove corporations in any fash-ion from the control of state govemments. The Four-teenth Amendment followed the freedom of a race from slavery. Justice Swayne said in the Slaughter House Cases, supra, that “by ‘any person’ was meant ail persons within the jurisdiction of the State. No distinction is intimated on account of race or color.” Corporations hâve neither race nor color. He knew the Amendment was intended to protect the life, liberty and property of human beings. The language of the Amendment itself does not support the theory that it was passed for the benefit of corporations. The first clause of § 1 of the Amendment reads: “Ail persons born or naturalized in the United States and sub- 11 San Mateo County v. Southern Pacific Railroad, 116 U. S. 138. See Benj. B. Kendrick, Journal of the Joint Committee on Reconstruction (1914, New York); Howard J. Graham, The “Conspiracy Theory” of the Fourteenth Amendment, 47 Yale L. J. 371; Donald Barr Chidsey, The Gentleman from New York—A Life of Roscoe Conklin, Yale University Press (1935). 88 OCTOBER TERM, 1937. Black, J., dissenting. 303 U. S. ject to the jurisdiction thereof, are citizens of the United States and of the State wherein they résidé.” Certainly a corporation cannot be naturalized and “persons” here is not broad enough to include “corporations.” The fîrst clause of the second sentence of § 1 reads: “No State shall make or enforce any law which shall abridge the privilèges or immunities of citizens of the United States; . . .” While efforts hâve been made to persuade this Court to allow corporations to claim the protection of this clause, these efforts hâve not been successful.12 The next clause of the second sentence reads : “nor shall any State deprive any person of life, liberty or property without due process of law; . . .” It has not been de-cided that this clause prohibits a state from depriving a corporation of “life.” This Court has expressly held that “the liberty guaranteed by the Fourteenth Amendment against deprivation without due process of law is the liberty of natural, not artificiel persons.”13 Thus, the words “life” and “liberty” do not apply to corporations, and of course they could not hâve been so intended to apply. However, the decisions of this Court which the ma-jority follow hold that corporations are included in this clause insofar as the word “property” is concerned. In other words, this clause is construed to mean as follows: “Nor shall any State deprive any human being of life, liberty or property without due process of law ; nor shall any State deprive any corporation of property without due process of law.” The last clause of this second sentence of § 1 reads: “nor deny to any person within its jurisdiction the equal protection of the laws.” As used here, “person” has been construed to include corporations.14 ™ Sélover, Bâtes & Co. v. Walsh, 226 U. S. 112, 126. 18 Western Turf Assn. v. Greenberg, 204 U. S. 359, 363. 14 Gulf, C. & S. F. Ry. Co. v. Ellis, 165 U. S. 150, 154. 77 CÔNN. GENERAL CÔ. v. JOHNSON. Black, J., dissenting. 89 Both Congress and the people were familiar with the meaning of the word “corporation” at the time the Four-teenth Amendment was submitted and adopted. The judicial inclusion of the word “corporation” in the Four-teenth Amendment has had a revolutionary effect on our form of government. The States did not adopt the Amendment with knowledge of its sweeping meaning under its présent construction. No section of the Amendment gave notice to the people that, if adopted, it would subject every state law and municipal ordinance, affecting corporations, (and ail administrative actions under them) to censorship of the United States courts. No word in ail this Amendment gave any hint that its adoption would deprive the states of their long recognized power to reg-ulate corporations. The second section of the Amendment informed the people that représentatives would be apportioned among the several states “according to their respective numbers, counting the whole number of persons in each State, ex-cluding Indians not taxed.” No citizen could gather the impression here that while the word “persons” in the second section applied to human beings, the word “persons” in the first section in some instances applied to corporations. Section 3 of the Amendment said that “no person . . . shall be a Senator or Représentative in Congress,” (who “engaged in insurrection”). There was no intimation here that the word “person” in the first section in some instances included corporations. This Amendment sought to prevent discrimination by the states against classe^ or races. We are aware of this from words spoken in this Court within five years after its adoption, when the people and the courts were per-sonally familiar with the historical background of the Amendment. “We doubt very much whether any action of a State not directed by way of discrimination against 90 OCTOBER TERM, 1937. Black, J., dissenting. 303 U. S. the negroes as a class, or on account of their race, will ever be held to corne within the purview of this provision.” 16 Yet, of the cases in this Court in which the Fourteenth Amendment was applied during the first fifty years after its adoption, less than one-half of one per cent, invoked it in protection of the negro race, and more than fifty per cent, asked that its benefits be extended to corporations.16 If the people of this nation wish to deprive the States of their sovereign rights to détermine what is a fair and just tax upon corporations doing a purely local business within their own state boundaries, there is a way pro-vided by the Constitution to accomplish this purpose. That way does not lie along the course of judicial amendment to that fundamental charter. An Amendment hav-ing that purpose could be submitted by Congress as pro-vided by the Constitution. I do not believe that the Fourteenth Amendment had that purpose, nor that the people believed it had that purpose, nor that it should be construed as having that purpose. I believe the judgment of the Suprême Court of California should be sustained. 15 Slaughter House Cases, supra. M Charles Wallace Collins, The Fourteenth Amendment and the States, Boston (1912), p. 138. BLACKTON v. GORDON. 91 Opinion of the Court. BLACKTON v. GORDON. CERTIORARI TO THE COURT OF ERRORS AND APPEALS OF NEW JERSEY. No. 167. Argued January 5, 1938.—Decided January 31, 1938. Section 12 of the Act of March 4, 1915, 46 U. S. C. § 601, exempt-ing wages of seamen from attachaient, held inapplicable to the wages of a master of a vessel. P. 92. 118 N. J. L. 159; 191 Atl. 761, affirmed. Certiorari, 302 U. S. 667, to review a judgment affirm-ing a judgment against the petitioner, 117 N. J. L. 40; 186 Atl. 689, in a suit to enforce against him a statutory liability based on his refusai to honor a writ of attach-ment. Messrs. Clement K. Corbin and Edward A. Markley submitted on brief for petitioner. Mr. Aaron Gordon, with whom Mr. John W. Ockford was on the brief, for respondent. Mr. Justice Roberts delivered the opinion of the Court. The issue is whether the master of a vessel is entitled to the benefit of § 12 of the Act of March 4, 1915,1 ex-empting wages of seamen from attachment. The respondent recovered judgment against one Find-lay, the captain of the tug Waverly, a registered vessel of the United States operating in Néw York Harbor. Un-der a state statute Findlay’s wages due from his employer, the Erie Railroad Company, were attached by the service of an order on the petitioner, superintendent of the marine department of the railroad company. It is not disputed that if Findlay’s wages were subject to 1c. 153, 38 Stat. 1164, 1169; U. S. C. Tit. 46, § 601. 92 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. garnishment the order, and its service upon the petitioner, were regular and lawful. The petitioner asserted that the fédéral statute exempted Findlay’s wages from execution and refused to honor the order. Thereupon action was instituted by respondent against petitioner, pur-suant to local statute which in such a case renders the récusant officer liable for the amount of the judgment. On the trial petitioner’s motions for a nonsuit and for a directed verdict were denied and judgment went for the respondent. The petitioner successively appealed to the Suprême Court and the Court of Errors and Appeals. The judgment was affirmed.2 Because of the importance of the question we granted the writ of certiorari. The words of the statute are: “No wages due or accruing to any seaman or apprentice shall be subject to attach-ment or arrestment from any court . . .” While, within the purview of some of the acts concerning shipping, a master is included in the class designated seamen, in others the expression excludes the master.3 In this case we must détermine whether Congress intended, by § 12 of the Act of 1915, to extend to a master the exemption of seamen’s wages from garnishment. Decision is aided by a considération of the provision in its original setting. It was first enacted as § 61 of the Act of June 7, 1872,4 which authorized the appointment of shipping commissioners to protect merchant seamen and to superintend their shipment and discharge. Scrutiny of the Act as a whole leads to the view that in ail matters affecting wages seamen were treated as a class which excluded masters; and this conclusion is required by § 65,5 which is in part: “That to avoid doubt in the construction of this act, every person having the command of any ship belonging to any * 117 N. J. L. 40, 186 Atl. 689; 118 N. J. L. 159, 191 Atl. 761. 8 Warner v. Goltra, 293 U. S. 155, 157, 158. 417 Stat. 262, 276. 817 Stat. 277. 91 BLACKTON v. GORDON. Opinion of the Court. 93 citizen of the United States shall, within the meaning and for the purposes of this act, be deemed and taken to be the ‘master’ of such ship; and that every person (ap-prentices excepted) who shall be employed or engaged to serve in any capacity on board the same shall be deemed and taken to be a ‘seaman’ within the meaning and for the purposes of this act; . . .” In its présent form the pertinent language of § 12 of the Act of March 4, 1915, is identical with that originally employed in § 61 of the Act of 1872, which became § 4536 of the Revised Statutes. Section 12 of the Act of March 4, 1915, reënacted the section, adding a provision to make it applicable to fishermen employed on fishing vessels as well as to seamen. The statute is now § 601 of Title 46 of the United States Code. Section 65 of the Act of 1872 became § 4612 of the Revised Statutes and, with immaterial amendments, now is § 713 of Title 46 of the United States Code. Varions other provisions of the Act of 1872 embodied in the Revised Statutes, either in their original form or as amended by the Act of March 4,1915, and by the Merchant Marine Act of 1920,6 now appear, with provisions of other statutes, as sections of Title 46 of the Code. In compiling it the original language of § 65 of the Act of 1872 “To avoid doubt in the construction of this act,” was, in § 713 of Title 46, changed to read: “In the construction of this chapter.” The change in phraseology has given rise to the impression that the définitions found in § 713 apply indifferently to the various statutes affecting merchant shipping.7 To avoid confusion in determining the appli-cability of the définitions contained in that section, it is necessary to trace to their origin the substantive sections to which it may be deemed to refer, and to construe them in the light of the évident intent of Congress in the use 6 c. 250, 41 Stat. 988. 7 Warner v. Goltra, supra, p. 162, 94 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. of the word “seaman” in the original Act. Since the pertinent provision of § 12 of the Act of 1915 here under considération and the définitions of § 713 of Title 46 of the Code were commonly derived from the Act of 1872 and hâve not been materially changed, they must be read in collocation, and when this is done, the intent of Congress to exclude masters from the exemption accorded seamen is plain.8 The petitioner contends that § 61 of the Act of 1872 was modified by the Act of June 9, 1874,9 whereby the provisions of the Act of 1872 were made inapplicable to vessels in the coastwise trade. The latter Act has been carried into the Code as § 544 of Title 46, and it is said that the repeal of § 61 by the Act of March 4, 1915, and the reënactment of the section, slightly altered, did not operate to repeal the Act of 1874. In view of our decision that a master is not within the exemption granted by § 12 of the Act of 1915 we need not pass upon this question. The judgment is Affirmed. Mr. Justice Cardozo took no part in the considération or decision of this case. 8 Cf. Warner v. Goltra, supra, p. 162. 8 c. 260, 18 Stat. 64. INDIANA ex rel. ANDERSON v. BRAND. 95 Syllabus. INDIANA ex rel. ANDERSON v. BRAND, TRUSTEE. CERTIORARI TO THE SUPREME COURT OF INDIANA. No. 256. Argued January 10, 1938.—Decided January 31, 1938. 1. Where a state court does not décidé a cause upon an independent state ground, but, deeming a fédéral question to be before it, actually entertains and décidés that question adversely to the fédéral right asserted, this Court has jurisdiction to review the judgment if final. P. 98. 2. This Court may not refuse jurisdiction because the state court might hâve based its decision, consistently with the record, upon an independent and adéquate state ground. P. 98. 3. The opinion of the state court may be examined to ascertain whether a fédéral question was raised and decided or whether the court rested its judgment on an adéquate non-federal ground. P. 98. 4. Any doubt here as to whether the validity of the state statute under the Fédéral Constitution was drawn into question, arising from the generality of a reference in the opinion of the state court, held removed by a certificate signed by ail the justices of the state court, and made a part of the record, to the effect that the reference was to Art, I, § 10, of the Constitution of the United States. P. 99. 5. A legislative enactment may contain provisions which, when ac-cepted as the basis of action by individuals, become contracts between them and the State, within the protection of Art. I, § 10, of the Fédéral Constitution. P. 100. 6. Where it is claimed that a state statute impairs the obligation of a contract alleged to hâve been created by an earlier statute, this Court, while according great weight to the views of the high-est court of the State, must détermine for itself questions as to the existence and effect of the contract and as to whether its obligation was impaired. P. 100. 7. The Indiana Teachers’ Tenure Act of 1927 provided that a public school teacher who had served under contract for five or more successive years, and thereafter entered into a contract for further service with the school corporation, thereby became a “permanent teacher,” and that the contract, upon the expiration of its stated 96 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. terin, should be deemed an “indefinite contract” and remain in force until succeeded by a new contract signed by both parties or cancelled in the manner provided in the Act. A permanent teach-er’s contract must be in writing and could be cancelled only after notice and hearing, and for causes specified in the Act, but not for political or personal reasons. The teacher could cancel only upon five days’ notice, but not during the school tenn nor within 30 days of the beginning thereof. An amendatory Act of 1933, as construed by the state court, repealed the earlier Act in so far as township teachers and schools were concemed, and permit-ted the termination of the employaient of such teachers without regard to the conditions and limitations of the earlier Act. Held that, under the Act of 1927, the right of a permanent teacher to continued employaient upon an indefinite contract was contrac-tual, and the obligation of such a contract in the case of a township teacher was unconstitutionally impaired by the Act of 1933. P. 104. 8. Although every contract is made subject to the implied condition that its fulfillment may be frustrated by proper exercise of the police power, yet in order to hâve this effect the exercise of the power must be for an end which is in fact public and the means adopted must be reasonably adapted to that end. P. 108. 9. The state court’s decision of a fédéral question in favor of the défendant being erroneous, and it not having passed upon a second ground of demurrer which appears to involve no fédéral question, and which may présent a defense still open to the défendant, the cause is reversed and remanded for further proceedings. P. 109. 5 N. E. (2d) 531, 913; 7 N. E. (2d) 777, reversed. Certiorari, 302 U. S. 678, to review a judgment affirm-ing the dismissal, on demurrer to the complaint, of an action for a writ of mandate. Messrs. Paul R. Shafer and Thomas F. OMara, with whom Mr. Denver Harlan was on the brief, for petitioner. Messrs. Raymond Brooks and Asa J. Smith, with whom Mr. George C. Gertman was on the brief, for respondent. Mr. Justice Roberts delivered the opinion of the Court. The petitioner sought a writ of mandate to compel the INDIANA ex bel. ANDERSON v. BRAND. 97 95 Opinion of the Court. respondent1 to continue her in employment as a public school teacher. Her complaint alleged that as a duly li-censed teacher she entered into a contract in September, 1924, to teach in the township schools and, pursuant to successive contracts, taught continuously to and includ-ing the school year 1932-1933; that her contracts for the school years 1931-1932 and 1932-1933 contained this clause: “It is further agreed by the contracting parties that ail of the provisions of the Teachers’ Tenure Law, approved March 8, 1927, shall be in full force and effect in this contract”; and that by force of that Act she had a contract, indefinite in duration, which could be can-celled by the respondent only in the manner and for the causes specified in the Act. She charged that in July, 1933, the respondent notified her he proposed to cancel her contract for cause; that, after a hearing, he adhered to his decision and the County Superintendent affirmed his action; that, despite what occurred in July, 1933, the petitioner was permitted to teach during the school year 1933-1934 and the respondent was presently threatening to terminate her employment at the end of that year. The complaint alleged the termination of her employment would be a breach of her contract with the school corporation. The respondent demurred on the grounds that (1) the complaint disclosed the matters pleaded had been submitted to the respondent and the County Superintendent who were authorized to try the issues and had lawfully determined them in favor of the respondent; and (2) the Teachers’ Tenure Law had been repealed in respect of teachers in township schools. The demurrer was sustained and the petitioner appealed to the State ‘The proceeding was instituted against the respondent’s predeces-sor who then held the office of School Trustée; the respondent was subsequently substituted as défendant. Nothing turns on this substitution and both trustées will be referred to as the respondent. 53383®— 38--------7 98 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. Suprême Court which affirmed the judgment.2 The court did not discuss the first ground of demurrer relating to the action taken in the school year 1932-1933, but rested its decision upon the second, that, by an Act of 1933, the Teachers’ Tenure Law had beeri repealed as respects teachers in township schools;* and held that the repeal did not deprive the petitioner of a vested property right and did not impair her contract within the meaning of the Constitution. In its original opinion the Court said: “The relatrix contends . . . that, having become a permanent teacher under the Teachers’ Tenure Law before the amendment, she had a vested property right in her indefinite contract, which may not be impaired under the Constitution. The question is whether there is a vested right in a permanent teacher’s contract; whether, under the tenure law, there is a grant which cannot lawfully be impaired by a repeal of the statute.” Where the state court does not décidé against a petitioner or appellant upon an independent state ground, but deeming the fédéral question to be before it, actually entertains and décidés that question adversely to the fédéral right asserted, this Court has jurisdiction to review the judgment if, as here, it is a final judgment.3 We cannot refuse jurisdiction because the state court might hâve based its decision, consistently with the record, upon an independent and adéquate non-federal ground. And since the amendment of the judiciary act of 17894 by the act of February 5, 18676 it has always been held this Court may examine the opinion of the state court to ascertain whether a fed- 2 5 N. E. (2d) 531; on rehearing, 7 N. E. (2d) 777; dissenting opinion of Treanor, J., 5 N. E. (2d) 913. 3 Mur dock v. Memphis, 20 Wall. 590, 635-6; Henderson Bridge Co. v. Henderson, 173 U. S. 592, 608; Rogers v. Hennepin County, 240 U. S. 184, 188-189; Gray son v. Harris, 267 U. S. 352, 358; Virginia v. Impérial Coal Sales Co., 293 U. S. 15, 16; International Steel Co. n. National Surety Co., 297 U. S. 657, 666. * § 25, 1 Stat. 85. ‘ § 2, 14 Stat. 386. INDIANA ex bel. ANDERSON v. BRAND. 99 95 Opinion of the Court. eral question was raised and decided, and whether the court rested its judgment on an adéquate non-federal ground.6 Any ambiguity arising from the generality of the court’s référencé to the Constitution is resolved by a certificate signed by ali the Justices of the Court, made a part of the record, to the effect that the référencé to the Constitution in the opinion was to Art. I, § 10 of the Constitution of the United States.7 It thus appearing that the constitutional validity of the repealing act was drawn in question, and the statute sustained, we issued the writ of certiorari. The court below holds that in Indiana teachers’ con-tracts are made for but one year; that there is no con-tractual right to be continued as a teacher from year to year; that the law grants a privilège to one who has taught five years and signed a new contract to continue in employment under given conditions; that the statute is directed merely to the exercise of their powers by the school authorities and the policy therein expressed may be altered at the will of the législature; that in enacting laws for the government of public schools the législature exercises a function of sovereignty and the power to con-trol public policy in respect of their management and operation cannot be contracted away by one législature so as to create a permanent public policy unchangeable by succeeding législatures. In the alternative the court déclarés that if the relationship be considered as controlled by the rules of private contract the provision for reëm- * Murdock v. Memphis, 20 Wall. 590, 633-634; Kreiger v. Shelby R. Co., 125 U. S. 39, 44; Bank of Commerce v. Tennessee, 163 U. S. 416, 421; Thompson v. Maxwell Land Grant Co., 168 U. S. 451, 456; Columbia Water Power Co. v. Columbia Electric St. Ry. Co., 172 U. S. 475, 488-489; Abie State Bank v. Bryan, 282 U. S. 765, 771; Utley v. St. Petersburg, 292 U. S. 106, 111; Fox Film Corp. v. Muller, 296 U. S. 207, 209. 7 International Steel Co. v. National Surety Co., 297 U. S. 657, 662. 100 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. ployment from year to year is unenforceable for want of mutuality. As in most cases brought to this court under the con-tract clause of the Constitution, the question is as to the existence and nature of the contract and not as to the construction of the law which is supposed to impair it. The principal function of a legislative body is not to make contracts but to make laws which déclaré the policy of the state and are subject to repeal when a subséquent législature shall détermine to alter that policy. Never-theless, it is established that a legislative enactment may contain provisions which, when accepted as the basis of action by individuals, become contracts between them and the State or its subdivisions within the protection of Art. I, § 10.8 If the people’s représentatives deem it in the public interest they may adopt a policy of contract-ing in respect of public business for a term longer than the life of the current session of the législature. This the petitioner claims has been done with respect to permanent teachers. The Suprême Court has decided, how-ever, that it is the state’s policy not to bind school corporations by contract for more than one year. On such a question, one primarily of state law, we accord respectful considération and great weight to the views of the State’s highest court but, in order that the constitutional mandate may not become a dead letter, we are bound to décidé for ourselves whether a contract was made, what are its terms and conditions, and whether the State has, by later législation, impaired its obligation.9 This involves an appraisal of the statutes of the State and the decisions of its courts. The courts of Indiana hâve long recognized that the employment of school teachers was contractual and hâve a New Jersey v. Yard, 95 U. S. 104, 113, 114. 8 Phelps n. Board of Education, 300 U. S. 319, 322, and cases cited. INDIANA ex rel. ANDERSON v. BRAND. 101 95 Opinion of the Court. afforded relief in actions upon teachers’ contracts.10 An Act adopted in 189911 required ail contracts between teachers and school corporations to be in writing, signed by the parties to be charged, and to be made a matter of public record. A statute of 192112 enacted that every such contract should be in writing and should state the date of the beginning of the school terni, the number of months therein, the amount of the salary for the term, and the number of payments to be made during the school year. In 1927 the State adopted the Teachers’ Tenure Act13 under which the présent controversy arises. The pertinent portions are copied in the margin.14 By this Act it was provided that a teacher who has served under con- 10 City of CrawfordsviUe v. Hays, 42 Ind. 200; Charlestown School Twp. v. Hay, 74 Ind. 127; Harrison School Twp. v. McGregor, 96 Ind. 185; Kiefer n. Troy School Twp., 102 Ind. 279; 1 N. E. 560; Sparta School Twp. v. Mendell, 138 Ind. 188; 37 N. E. 604; School City of Lafayette v. Bloom, 17 Ind. App. 461; 46 N. E. 1016; Henry School Twp. v. Meredith, 32 Ind. App. 607 ; 70 N. E. 393; Gregg School Twp. v. Hinshaw, 76 Ind. App. 503; 132 N. E. 586. “Act of Feb. 28, 1899, G. L. Ind. 1899, p. 173, Bums’ Ind. Stat. Ann. 1933, §§ 28-4302 and 28-4303. “Act of March 7, 1921; Acts of 1921, p. 195; Burns’ Ind. Stat. Ann. 1933, § 28-4304. 18 Act of March 8, 1927; Acts of 1927, p. 259, Burns’ Ind. Stat. Ann. Supp. 1929, § 6967.1. ““Section 1. Be it enacted by the general assembly of the State of Indiana, That any person who has served or who shall serve under contract as a teacher in any school corporation in the State of Indiana for five or more successive years, and who shall hereafter enter into a teacher’s contract for further service with such corporation, shall thereupon become a permanent teacher of such school corporation. . . . Upon the expiration of any contract between such school corporation and a permanent teacher, such contract shall be deemed to continue in effect for an indefinite period and shall be known as an indefinite contract. Such an indefinite contract shall remain in force unless succeeded by a new contract signed by both parties or unless it shall be cancelled as provided in section 2 of this act: Provided, That teachers’ contracts shall provide for the annual détermination of the date of beginning and length of school terms by 102 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. tract for five or more successive years, and thereafter enters into a contract for further service with the school corporation, shall become a permanent teacher and the contract, upon the expiration of its stated term, shall be deemed to continue in effect for an indefinite period, shall be known as an indefinite contract, and shall remain in force unless succeeded by a new contract or cancelled as provided in the Act. The corporation may cancel the the school corporation: and, Provided, further, That teachers’ con-tracts may contain provisions for the fixing of the amount of annual compensation from year to year by a salary schedule adopted by the school corporation and such schedule shall be deemed to be a part of such contract: and, Provided, further, That such schedule may be changed by such school corporation on or before May Ist of any year, such changes to become effective at the beginning of the following school year: Provided, That ail teachers affected by such changes shall be fumished with printed copies of such changed schedule within thirty days after its adoption. “Sec. 2. Any indefinite contract with a permanent teacher as defined in section 1 of this act may be cancelled only in the following manner: Not less than thirty days nor more than forty days before the considération by any school corporation of the cancellation of any such contract, such teacher shall be notified in writing of the exact date, time when and place where such considération is to take place; and such teacher shall be fumished a written statement of the reasons for such considération, within five days after any written request for such statement; and such teacher shall, upon written request for a hearing, filed within fifteen days after the receipt by said teacher of notice of date, time and place of such considération, be given such a hearing before the school board, in the case of cities and towns, and before the township trustée, in the case of townships; such hearing shall be held not less than five days after such request is filed and such teacher shall be given not less than five days’ notice of the time and place of such hearing. Such teacher, at the hearing, shall hâve a right to a full statement of the reasons for the proposed cancellation of such contract, and shall hâve a right to be heard, to présent the testimony of witnesses and other evidence bearing upon the reasons for the proposed cancellation of such contract. No such contract shall be cancelled until INDIANA ex rel. ANDERSON v. BRAND. 103 95 Opinion of the Court. contract, after notice and hearing, for incompetency, insubordination, neglect of duty, immorality, justifiable decrease in the number of teaching positions, or other good or just cause, but not for political or personal reasons. The teacher may not cancel the contract during the school terni nor for a period of thirty days previous to the begin-ning of any terni (unless by mu tuai agreement) and may cancel only upon five days’ notice. the date set for considération of the cancellation of such contract; nor until after a hearing is held, if such hearing is requested by said teacher; nor until, in the case of teachers, supervisors, and principals, the city or town Superintendents, in cities and towns, and the county superintendents, in townships and in cities and towns not having superintendents, shall hâve given the school corporation his recommendations thereon, and it shall be the duty of such superintendent to présent such recommendations upon five days’ written notice to him by such school corporation. . . . Cancellation of an indefinite contract of a permanent teacher may be made for incompetency, insubordination (which shall be deemed to mean a wilful refusai to obey the school laws of this state or reasonable rules prescribed for the govemment of the public schools of such corporation), neglect of duty, immorality, justifiable decrease in the number of teaching positions or other good and just cause, but may not be made for political or personal reasons: . . . “Sec. 4. No permanent teacher shall be permitted to cancel his indefinite contract during the school term for which his said contract is in effect nor for a period of thirty (30) days previous to the beginning of such school term unless such cancellation is mutually agreed upon; such permanent teacher shall be permitted to cancel his indefinite contract at any other time by giving a five days’ notice to the school corporation. Any permanent teacher cancelling his indefinite contract in any other manner than in this section provided shall be deemed guilty of unprofessional conduct and the state superintendent is hereby authorized to suspend the license of such teacher for a period of not exceeding one year. . . . “Sec. 6. This act shall be construed as supplementary to an act of the general assembly, page 195, acts 1921, entitled, An act conceming teachers’ contracts and providing for the repeal of conflicting laws.’ ” 104 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. By an amendatory Act of 193315 township school corporations were omitted from the provisions of the Act of 1927. The court below construed this Act as repealing the Act of 1927 so far as township schools and teachers are concerned and as leaving the respondent free to terminate the petitioner’s employment. But we are of opinion that the petitioner had a valid contract with the respondent, the obligation of which would be impaired by the termination of her employment. Where the claim is that the State’s policy embodied in a statute is to bind its instrumentalities by contract, the cardinal inquiry is as to the terms of the statute supposed to create such a contract. The State long prior to the adoption of the Act of 1927 required the execution of written contracts between teachers and school corporations, specified certain subjects with which such contracts must deal, and required that they be made a matter of public record. These were annual contracts, covering a single school term. The Act of 1927 announced a new policy that a teacher who had served for five years under successive contracts, upon the execution of another was to become a permanent teacher and the last contract was to be indefinite as to duration and terminable by either party only upon compliance with the conditions set out in the statute. The policy which induced the législation evidently was that the teacher should hâve protection against the exercise of the right, which would otherwise inhere in the employer, of terminating the employment at the end of any school term without assigned reasons and solely at the employer’s pleasure. The state courts in earlier cases so declared.16 16 Act of March 1, 1933, Acts of 1933, p. 716, Bums’ Ind. Stat Ann. 1933, § 28-4307. ” Ratcliff v. Dick Johnson School Twp., 204 Ind. 525; 185 N. E. 143; Kostanzer v. State, 205 Ind. 536; 187 N. E. 337; State v. Stout, 206 Ind. 58; 187 N. E. 267; Arburn v. Hunt, 207 Ind. 61; 191 N. E. 148. INDIANA ex rel. ANDERSON v. BRAND. 105 95 Opinion of the Court. The title of the Act is couched in terms of contract. It speaks of the making and cancelling of indefinite contracts. In the body the word “contract” appears ten times in § 1, defining the relationship ; eleven times in § 2, relating to the termination of the employment by the employer, and four times in § 4, stating the conditions of termination by the teacher. The ténor of the Act indicates that the word “contract” was not used inadvertently or in other than its usual legal meaning. By § 6 it is expressly provided that the Act is a supplément to that of March 7, 1921, supra, re-quiring teachers’ employment contracts to be in writing. By § 1 it is provided that the written contract of a permanent teacher “shall be deemed to continue in effect for an indefinite period and shall be known as an indefinite contract.” Such an indefinite contract is to remain in force unless succeeded by a new contract signed by both parties or cancelled as provided in § 2. No more apt language could be employed to define a contractual relationship. By § 2 it is enacted that such indefinite contracts may be cancelled by the school corporation only in the manner specified. The admissible grounds of can-cellation, and the method by which the existence of such grounds shall be ascertained and made a matter of record, are carefully set out. Section 4 permits cancellation by the teacher only at certain times consistent with the con-venient administration of the school System and imposes a sanction for violation of its requirements. Examination of the entire Act convinces us that the teacher was by it assured of the possession of a binding and enforce-able contract against school districts. Until its decision in the présent case the Suprême Court of the State had uniformly held that the teacher’s right to continued employment by virtue of the indefinite contract created pursuant to the Act was contractual. In School City of Elwood v. State ex rel. Griffin, 203 Ind. 626; 180 N. E. 471, it was said (p. 634) : 106 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. “The position of a teacher in the public schools is not a public office, but an employment by contract between the teacher and the school corporation. The relation remains contractual after the teacher has, under the provisions of a teachers’ tenure law, become a permanent teacher—but the ternis and conditions of the contract are thereafter governed primarily by the statute.” In Kostanzer v. State, 205 Ind. 536; 187 N. E. 337, an action in mandate to compel reinstatement of a discharged teacher, it was said (p. 547) : “If appellee’s position is not an office appellants insist that mandamus is not available for the reason that the granting of mandatory relief results in enforcing a purely contractual right. It is true that mandatory relief against appellants will resuit in enforcing appellee’s rights under her contract; but the duty which the judgment of the trial court compelled appellants to perform was a duty enjoined by statute and not by contract. The contract between appellants and appellee created a relation which entitled appellee to hâve appellants perform the duty in question; but the duty was not imposed by any provision of the contract.” And in the same case it was also said (pp. 548-549) : “The tenure act permits a teacher to cancel his contract at any time after the close of a school term up to thirty days prior to the beginning of the next school term, pro-vided five days’ notice is given, and appellant contends that there was no contract between appellee and appellants for the reason ‘that a contract which does not bind both parties binds neither of them.’ This proposition is undoubtedly supported by the law of contracts. But there is nothing in the law of contracts to prevent one party to a contract granting to the other the privilège of rescission or cancellation on terms not reserved to the former party. The local school corporations are agents of the state in the administration of the public schools and the INDIANA ex rel. ANDERSON v. BRAND. 107 95 Opinion of the Court. General Assembly has the power to prescribe the terms of the contract to be executed by these agents.” In State N. Board of School Commissioners of Indian-apolis, 205 Ind. 582; 187 N. E. 392, an action in mandate to compel reinstatement of a discharged teacher, the court referred to the indefinite contract of a permanent teacher and held that it remained in full force and effect until succeeded by a new contract or cancelled as provided in § 2 of the Act. In Arburn v. Hunt, 207 Ind. 61; 191 N. E. 148, it is said: “The source of authority for the so-called permanent teacher’s contract is the statute. The législature need not hâve provided for such contracts, but, since it did so provide, the entire statute, with ail of its provisions, must be read into and considered as a part of the contract.” We think the decision in this case runs counter to the policy evinced by the Act of 1927, to its explicit mandate and to earlier decisions construing its provisions. Also that the decision in Phelps v. Board of Education, 300 U. S. 319, that the Act there considered did not create a contract, is not, as the court below suggests, authority for a like resuit here. Dodge v. Board of Education, 302 U. S. 74, on which the respondent relies is distinguish-able, because the statute there involved did not purport to bind the respondent by contract to the payment of retirement annuities, and similar législation in respect of other municipal employées had been consistently con-strued by the courts as not creating contracts. The respondent urges that every contract is subject to the police power and that in repealing the Teachers’ Tenure Act the législature validly exercised that reserved power of the state. The sufîicient answer is found in the statute. By § 2 of the Act of 1927 power is given to the school corporation to cancel a teacher’s indefinite contract for incompetency, insubordination (which is to be deemed to mean wilful refusai to obey the school laws of the 108 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. State or reasonable rules prescribed by the employer), neglect of duty, immorality, justifiable decrease in the number of teaching positions or other good and just cause. The permissible reasons for cancellation cover every conceivable basis for such action growing out of a déficient performance of the obligations undertaken by the teacher, and diminution of the school requirements. Although the causes specified constitute in themselves just and reasonable grounds for the termination of any ordinary contracta of employment, to preclude the as-sumption that any other valid ground was excluded by the énumération, the législature added that the relation might be terminated for any other good and just cause. Thus in the déclaration of the state’s policy, ample réservations in aid of the efficient administration of the school System were made. The express prohibitions are that the contract shall not be cancelled for political or personal reasons. We do not think the asserted change of policy evidenced by the repeal of the statute is that school boards may be at liberty to cancel a teacher’s contract for political or personal reasons. We do not understand the respondent so to contend. The most that can be said for his position is that, by the repeal, township school corporations were again put upon the basis of annual con-tracts, renewable at the pleasure of the board. It is sig-nificant that the Act of 1933 left the System of permanent teachers and indefinite contracts untouched as respects school corporations in cities and towns of the state. It is not contended, nor can it be thought, that the législature of 1933 determined that it was against public policy for school districts in cities and towns to terminate the employment of teachers of five or more years’ expérience for political or personal reasons and to permit cancellation, for the same reasons, in townships. Our decisions recognize that every contract is made subject to the implied condition that its fulfillment may INDIANA ex rel. ANDERSON v. BRAND. 109 95 Black, J., dissenting. be frustrated by a proper exercise of the police power but we hâve repeatedly said that, in order to hâve this effect, the exercise of the power must be for an end which is in fact public and the means adopted must be reasonably adapted to that end,17 and the Suprême Court of Indiana has taken the same view in respect of législation impairing the obligation of the contract of a state instrumentality.18 The causes of cancellation provided in the Act of 1927 and the rétention of the System of indefinite contracts in ail municipalities except townships by the Act of 1933 are persuasive that the repeal of the earlier Act by the latter was not an exercise of the police power for the attainment of ends to which its exercise may properly be directed. As the court below has not passed upon one of the grounds of demurrer which appears to involve no fédéral question, and may présent a defense still open to the re-spondent, we reverse the judgment and remand the cause for further proceedings not inconsistent with this opinion. Reversed. Mr. Justice Cardozo took no part in the considération or decision of this case. Mr. Justice Black, dissenting. In my opinion this reversai unconstitutionally limits the right of Indiana to control Indiana’s public school System. I believe the judgment should be afiirmed because: 17 Home Bdg. & Loan Assn. v. Blaisdell, 290 U. S. 398, 438; Worthen Co. v. Thomas, 292 U. S. 426, 431, 432; Worthen Co. n. Kavanaugh, 295 U. S. 56, 60; Treigle v. Acme Homestead Assn., 297 U. S. 189, 197. 18 Central Union Tel. Co. v. Indianapolis Tel. Co., 189 Ind. 210; 126 N. E. 628; Downing v. Indiana State Board of Agriculture, 129 Ind. 443 ; 28 N. E. 123. 110 OCTOBER TERM, 1937. Black, J., dissenting. 303 U. S. (1) It does not appear in the record that a fédéral question was necessarily involved in the decision of the state court;1 (2) The record does not disclose beyond a reasonable doubt2 that Indiana, by the Teachers Act of 1927, sur-rendered its sovereign, governmental right to change and alter at will legislative policy related to the public wel-fare, or that its législature had the power to do so. First. It does not appear from the record that a fédéral question “was necessarily involved in the decision; and that the state court could not hâve given the judgment or decree which they passed, without deciding it.”3 Therefore, “it is a matter of no conséquence to us that the court may hâve gone further and decided a fédéral question.”4 “Where a case in this Court can be decided without reference to questions arising under the Fédéral Constitution, that course is usually pursued and is not departed from without important reasons.” 5 Petitioner’s complaint disclosed: that, after a hearing, she was removed from her position as a teacher for causes including those set out in the statute, i. e., (1) “neglect of duty” and (2) “for other good and just cause”; and that the county superintendent, on appeal, approved her removal. A demurrer was sustained to the complaint. The demurrer assigned the general ground that the complaint failed to “state facts sufficient to constitute a good cause of action.” One of the spécifie reasons set out for demurrer was that the complaint showed on its face that petitioner had been removed only after a proper notice and hearings before the township trustée and the county superintendent, in accordance with the requirements of the Act. 1 Moore v. Mississippi, 21 Wall. 636, 639. 3 Cf. Ogden v. Saunders, 12 Wheat. 213, 270. 8 Armstrong v. Treasurer of Athens County, 16 Pet. 281, 285. 4 Moore v. Mississippi, supra. 6 Siler v. Louisville & N. R. Co., 213 U. S. 175, 193. INDIANA ex rel. ANDERSON v. BRAND. 111 95 Black, J., dissenting. Under these circumstances, we can consider the decision of the Indiana courts as based on a finding of inadequacy in petitioner’s complaint under Indiana law. This Court does not décidé “questions of a constitutional nature unless absolutely necessary to a decision of the case.” 6 We should not départ from this policy in order to strike down a law passed by a state in its sovereign capacity to establish legislative policies for the éducation of its people. Second. This Court has declared that “. . . neither the [Fourteenth] amendment . . . nor any other amend-ment, was designed to interfère with the power of the State, sometimes termed its police power, to prescribe régulations to promote . . . éducation . . . of the people ...” 7 Article 8, § 1 of the Constitution of Indiana provides: “Knowledge and learning, generally diffused throughout a community, being essential to the préservation of a free government; it shall be the duty of the General Assembly . . . to provide, by law, for a general and uniform System of Common Schools, wherein tuition shall be without charge, and equally open to ail.” In car-rying out this constitutional mandate to provide éducation for the people of the State, the législature of Indiana has found it necessary—as hâve other States—to alter legislative policy from time to time. The statutes and the decisions of Indiana indicate a laudable desire and a com-mendable effort not only to provide sufficient funds to 9 Burton v. United States, 196 U. S. 283, 295. “If the expérience of one hundred and fifty years of constitutional interprétation has taught any lesson, it is the unwisdom of making solemn déclarations as to the meaning of that instrument which are unnecessary to decision. They can serve no useful purpose and their only effect may be to embarrass the Court when decision becomes necessary. O’Don-oghue n. United States, 289 U. S. 516, 550; Humphrey’s Executor v. United States, 295 U. S. 602, 626-627.” Stone, J., dissenting, Wright v. United States, 302 U. S. 583, 604. 'Barbier v. Connolly, 113 U. S. 27, 31. 112 OCTOBER TERM, 1937. Black, J., dissenting. 303 U. S. carry out these educational aspirations of the State, but also to provide reasonable security of employment for teachers. Such effort brought about the “Indiana Teachers Tenure Act of 1927.” This law provided the conditions upon which “permanent” teachers with “indefi-nite contracts” could be removed from their positions, and was evidently intended to provide statutory security against their discharge by local school authorities for any causes except those specified in the law. These “permanent” teachers could cancel their “indefinite contracts” upon five days’ notice at any time except during the school term or for a period of thirty days previous to it. In 1933, the legislative représentatives of the people of Indiana decided to change this policy by excluding township school corporations from its operation. The contention here is that the statutory tenure given teachers under the 1927 Act amounted to contracts with the state which could not be impaired by repeal or modification of the law. The Indiana Suprême Court has consistently held, even before its decision in this case, that the right of teachers, under the 1927 Act, to serve until removed for cause, was not given by contract, but by statute. Such was the express holding in the two cases cited in the majority opinion: Kostanzer v. State, 205 Ind. 536; 187 N. E. 337; and Eïwood n. State, 203 Ind. 626; 180 N. E. 471. In Kostanzer v. State, supra, a teacher filed pétition for mandamus alleging removal contrary to the “indefinite contract” obligation under the Act of 1927. Mandamus was opposed as an improper remedy because the teachers sought to compel action under a teachers tenure “contracté Denying the contention that the teacher’s rights were fixed by contract, the Suprême Court of Indiana said: “But the duty which the judgment of the trial court compelled appellants to perform was a duty enjoined by INDIANA ex rel. ANDERSON v. BRAND. 113 95 Black, J., dissenting. statute and not by contract. . . . the duty was not im-posed by any provision of the contract. In School City of Elwood v. State ex rel. Griffin, supra, this same contention was disposed of in the following language: ‘It is because of appellees’ right under this statute . . . that mandamus is the proper remedy in this case. ... A public school teacher who, under a positive provision of the statute, has a fixed tenure of employment or can be removed only in a certain manner prescribed by the statute, is entitled to reinstatement if he has been removed from his position in violation of his statutory rights’ ” These cases demonstrate that the Suprême Court of Indiana has uniformly held that teachers did not hold their “indefinite” tenure under contract, but by grant of a repealable statute. In order to hold in this case that a contract was impaired, it is necessary to create a contract unauthorized by the Indiana législature and de-clared to be non-existent by the Indiana Suprême Court. In the similar case of Phelps v. Board of Education, 300 U. S. 319, coming to this Court from New Jersey, the Suprême Court of that State declared that: “The status of tenure teachers, whfle in one sense per-haps contractual, is in essence dépendent on a statute, . . . which the législature at will may abolish, or whose émoluments it may change.” Under the New Jersey Act, which appears in the mar-gin,8 teachers could serve during “good behavior and 8 The New Jersey Act (as quoted in Phelps v. Board of Education, 300 U. S. 319, 320-321) : Section 1 (4 N. J. Comp. St. 1910, p. 4763). “The service of ail teachers, principals, supervising principals of the public schools in any school district of this State shall be during good behavior and efficiency, after the expiration of a period of employment of three consecutive years in that district, unless a shorter period is fixed by the employing board; . . . No principal or teacher shall be dis-missed or subjected to réduction of salary in said school district ex-cept for inefficiency, incapacity, conduct unbecoming a teacher or 53383°—38---------8 114 OCTOBER TERM, 1937. Black, J., dissenting. 303 U. S. efficiency” and subject to removal only after a hearing and for cause. The Suprême Court of New Jersey declared that the tenure of New Jersey teachers was “in one sense perhaps contractual.” The Suprême Court of Indiana declared that the tenure of Indiana teachers was not contractual. Yet this Court in the case of Phelps v. Board of Education, supra, decided that New Jersey’s discharge of its teachers employed by the State “in a sense perhaps contractual” did not impair their contracts. The Court now strikes down Indiana’s Teachers Tenure Law after repeated decisions by the state’s Suprême Court that the teachers tenure is not contractual. The intent of the New Jersey Act and the intent of the Indiana Act were evidently identical and in view of this fact, I believe that the decision on the New Jersey appeal and the majority decision on the Indiana appeal are irreconcilable. The Act of 1927 certainly does not clearly establish that the people of Indiana intended to surrender their sov-ereign right to change their educational policies from time to time to meet new needs or changed conditions. Under these circumstances “The presumption is that such a law (Teachers Tenure Law) is not intended to create private contractual or vested rights but merely déclarés a policy to be pursued until the législature shall ordain otherwise.”9 It is the end of every government to promote the general welfare of its people and we do not assume “that the government intended to diminish its power of accom-plishing the end for which it was created.”10 The Suprême Court of Indiana here held that “the Tenure Law does not purport to give a teacher a definite other just cause, and after a written charge of the cause or causes shall hâve been preferred against him or her, . . . and after the charge shall hâve been examined into and found true in fact by said Board of Education, upon reasonable notice to the person charged, who may be represented by counsel at the hearing. . . .” 8 Dodge n. Board of Education, 302 U. S. 74, 79. 18 Charles River Bridge v. Warren Bridge, 11 Pet. 420, 547. INDIANA ex rel. ANDERSON v. BRAND. 115 95 Black, J., dissenting. and permanent contract. The word ‘inde finit e’ is used in the statute itself. . . . The Tenure statute was only intended as a limitation upon the plenary power of local school officiais to cancel contracts. ... It was not intended as, and cannot be, a limitation upon the power of future Législatures to change the law respecting teachers and their tenures. These are matters of public policy, of purely governmental concem, in which the legislative power cannot be exhausted or consumed, or con-tracted away, so as to limit the discrétion of future General Assemblies.”11 Prior to this decision and even before the 1927 Act, the Suprême Court of Indiana had said : “With that [legislative] détermination [relating to educational matters] the judiciary can no more rightfuïly interfère, than can the Législature with a decree or judg-ment pronounced by a judicial tribunal. . . . “As the power over schools is a legislative one, it is not exhausted by exercise. The Législature having tried one plan is not precluded from trying another. It has a choice of methods, and may change its plans as often as it deems necessary or expédient; and for mistakes or abuses it is answerable to the people, but not to the court.”12 The clear purport of Indiana law is that its législature cannot surrender any part of its plenary constitutional right to repeal, alter or amend existing législation relating to the school System whenever the conditions demand change for the public good. Under Indiana law the législature can neither barter nor give away its constitutional investiture of power. It can make no contract in conflict with this sovereign power. The construction of the constitution of Indiana by the Suprême Court of Indiana must be accepted as correct. That court holds that Indi- 115. N. E. (2d) 531, 532. State ex rel. Clark v. Haworth, 122 Ind. 462; 23 N. E. 946. 116 OCTOBER TERM, 1937. Black, J., dissenting. 303 U. S. ana’s Constitution invests Indiana’s législature with continuing power to change Indiana’s educational policies. It has here held that the législature did not attempt or intend to surrender its constitutional power by authoriz-ing definite contracts which would prevent the future exercise of this continuing, constitutional power. If the constitution and statutes of Indiana, as construed by its Suprême Court, prohibit the législature from making a contract which is inconsistent with a continuing power to legislate, there could hâve been no definite contracts to be impaired. “The contracts designed to be protected by the [Fédéral Constitution] . . . are contracts by which perject rights, certain definite, fixed private rights of property, are vested. ... It follows, then, upon principle, that, in every perfect or competent government, there must exist a general power to enact and to repeal laws; and to create, and change or discontinue, the agents designated for the execution of those laws.”13 Merits of a policy establishing a permanent teacher tenure law are not for considération here. We are dealing with the constitutional right of the people of a sovereign state to control their own public school System as they deem best for the public welfare. This Court should neither make it impossible for states to experiment in the matter of security of tenure for their teachers, nor deprive them of the right to change a policy if it is found that it has not operated successfully. The Indiana Constitution gives the State législature complété authority to control the public school System. The State Suprême Court déclarés that under this au-thority the législature can change school plans as often as it believes a change will promote the interest of éducation “and for mistakes or abuses it is answerable to the people, 18 Butler v. Pennsylvania, 10 How. 402, 416. INDIANA ex rel. ANDERSON v. BRAND. 117 95 Black, J., dissenting. but not to the court.”14 I believe the people of Indiana, if they prefer, hâve the right under the Fédéral Constitution to entrust this important public policy to their elective représentatives rather than to the courts. De-mocracy permits the people to rule. I cannot agréé that the constitutional prohibition against impairment of con-tracts was intended to—or does—transfer in part the détermination of the educational policy of Indiana from the législature of that State to this Court. Indiana, in harmony with our national tradition, seeks to work out a school System, offering éducation to ail, as “essential to the préservation of free government.” That great function of an advancing society has heretofore been exercised by the states. I find no constitutional authority for this Court to appropriate that power. Indiana’s high-est court has said that the State did not, and has strongly indicated that the législature could not, make contracts with a few citizens, that would take away from ail the citizens, the continuing power to alter the educational policy for the best interests of Indiana school children. The majority decision now places in this Court a power which has been exercised by the states since the adoption of our Constitution. The people hâve not surrendered that power to this Court by constitutional amendment. For these reasons I cannot agréé to the majority decision and I believe the judgment of the Suprême Court of Indiana should be affirmed. 14 State ex rel. Clark v. Haworth, supra. 118 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. FOSTER et al., EXECUTORS, v. UNITED STATES. CERTIORARI TO THE COURT OF CLAIMS. No. 189. Argued January 10, 11, 1938.—Decided January 31, 1938. 1. For the purpose of the fédéral income tax, earnings accumulated by a corporation prior to March 1, 1913 are deemed capital. P. 121. 2. Amounts distributed by a corporation in partial liquidation, i. e., in cancellation or rédemption of part of its stock, are, under subsection (c) of § 115 of the Revenue Act of 1928, chargeable to capital, which, for this purpose, includes March 1, 1913 surplus, and are not to be considered a distribution of earnings or profits within the meaning of subsection (b) for the purpose of deter-mining the taxability of subséquent distributions. Pp. 121-122. 84 Ct. Qs. 193; 17 F. Supp. 191, affirmed. Certiorari, 302 U. S. 667, to review a judgment against the petitioners in a suit to recover an alleged overpay-ment of income taxes. In the trial court, upon the death of the original plaintiff, petitioners, her executors, were substituted as parties plaintiff. Mr. William P. McCool argued the cause, and Messrs. R. Kemp Slaughter, Hugh C. Bickford, and C. Clifton Owens were on the brief, for petitioners. Mr. Arnold Raum, with whom Solicitor General Reed, Assistant Attorney General Morris, and Messrs. Sewall Key and George H. Foster were on the brief, for the United States. Mr. Justice Black delivered the opinion of the Court. Petitioners’ right (as executors) to an income tax re-fund dépends upon whether a dividend paid by the Foster Lumber Company in 1930 is tax exempt as represent-ing corporate earnings accumulated before March 1, 1913. FOSTER v. UNITED STATES. 119 118 Opinion of the Court. This dividend is taxable under the Revenue Act of 19281 if paid from earnings accumulated after 1913. The Court of Claims found the dividend taxable.2 Petitioners contend that the 1930 dividend was trace-able to the Company’s pre-1913 accumulations because its post-1913 earnings had been exhausted by a distribution in 1929. The circumstances of the 1929 distribution and the 1930 dividend were: The Foster Lumber Company was a family corporation, organized in 1896 with a capital stock of $200,000. March 1, 1913, when the fédéral income tax became effective, the increased value of the company’s property and its undistributed profits were more than $3,725,000. Petitioners insist that a distribution of $1,025,000 on October 10, 1929, completely exhausted the $330,578.98 total undistributed profits which had accumulated since March 1, 1913. This 1929 distribution, however, was not a dividend. It was paid by the company to cancel and liquidate five hundred shares of its own $100 par value stock and represented payment of $2,050 per share, the agreed value as of March, 1913. February 11, 1930, the company declared a $225,000 dividend and this refund is sought for the tax paid upon a shareholder’s part of this dividend. Between October 10, 1929 (the date of the $1,025,000 stock purchase) and February 11, 1930 (the date of the $225,000 dividend) the company’s earnings amounted to only $82,758.17. Petitioners take the position that only $82,758.17 of this $225,000 dividend of 1930 can be taxed, urging that the balance is tax exempt because it must be treated as representing pre-1913 accumulations. Subsection (a) of § 115 of the Revenue Act of 19283 defines “dividend,” for income tax purposes, as “any 1 c. 852, 45 Stat. 791. ’ 17 F. Supp. 191 ; (supplémentai opinion) 18 F. Supp. 790. 3 Revenue Act of 1928, c. 852, 45 Stat. 791, 822. 120 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. distribution made by a corporation to its shareholders, . . . ont of its earnings or profits accumulated after February 28,1913” Subsection (b) of this income tax law exempts cor-porate earnings and profits accumulated before March 1, 1913. This subsection also provides that for income tax purposes ail distributions are paid from “the most re-cently accumulated earnings or profits.” The obvious purpose of the provision was to prevent corporations from attributing dividend payments to pre-1913 accumulations to avoid taxes imposed upon profits earned after March, 1913. Petitioners’ contention is that the $330,-578.98 earned after 1913, as “the most recently accumulated earnings or profits” was automatically exhausted in part payment of the $1,025,000 stock purchase and thus escaped taxation. In this manner, pre-1913 corporate non-taxable earnings could be used to avoid taxes on corporate profits earned after 1913. We hâve previously said that Subsections (a) and (b), supra, construed together, disclose legislative purpose that pre-1913 accumulations shall not be distributed “in such a fashion as to permit profits accumulated after that date to escape taxation.”4 Petitioners ask that we now construe these provisions in a way which would facilitate the escape of such profits from taxation and thereby de-feat the undoubted purpose of Congress. We are urged so to expand and broaden an exemption granted by Congress as a “concession to the equity of stockholders” 5 that such concession would in reality serve to nullify and defeat the tax on corporate profits earned after 1913. Courts should construe laws in harmony with the legislative intent and seek to carry out legislative purpose. With respect to the tax provisions under considération, there is no uncertainty as to the legislative purpose to 4 Helvering n. Canfield, 291 U. S. 163, 168. 6 Lynch v. Homby, 247 U. S. 339, 346. 118 FOSTER v. UNITED STATES. Opinion of the Court. 121 tax post-1913 corporate earnings. We must not give effect to any contrivance which would defeat a tax Congress plainly intended to impose. The use of bookkeep-ing terms and accounting forms and devices cannot be permitted to devitalize valid tax laws. The transaction under which this Company paid $1,025,000 cash for its own stock of $50,000 par value does not fall within Subsections (a) and (b) of § 115. Its character and effect are determined by Subsections (c) and (h) which relate to distributions in complété or partial corporate liquidation.6 Subsection (c), governing this stock purchase transaction, directs that . In the case of amounts distrib-uted in partial liquidation . . . the part of such distribution which is properly chargeable to capital account shall not be considered a distribution of ^earnings or profits within the meaning of subsection (h) ... for the pur-pose of determining the taxability of subséquent distributions ...”7 This provision of the Revenue Act of 1928 also sub-stantially obtained in the Revenue Act of 1924.8 Prior even to the 1924 Act, this Court had determined that, for income' tax purposes, earnings of a corporation accumu-lated prior to 1913 are to be considered capital.9 In the ‘ Cf. Hellmich v. Hellman, 276 U. S. 233, 237. 7 Subsection (h) (Revenue Act of 1928, supra, at 823): “Définition of partial liquidation.—As used in this section the term 'amounts distributed in partial liquidation’ means a distribution by a corporation in complété cancellation or rédemption of a part of its stock, or one of a sériés of distributions in complété cancellation or rédemption of ail or a portion of its stock.” 8 § 201 (c), c. 234, 43 Stat. 253, 255. . . we are bound to consider accumulations that accrued to a corporation prior to January 1, 1913, as . . . capital, . . .” Southern Pacific Co. v. Lowe, VA! U. S. 335 (1917). Also, see Lynch n. Turrish, 247 U. S. 221; Doyle v. Mitchell Bros. Co., 247 U. S. 179 (1917); “. . . what is called the stockholder’s share in the accumu- 122 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. light of these decisions, Congress obviously intended that corporate funds distributed under the circumstances here shown should be “chargeable to capital account” and that stock purchases of the type here involved should not be considered “for the purpose of determining the taxability of subséquent distributions by the corporation.” Acceptance of petitioners’ contention would permit corporate profits accumulated since March, 1913 to escape taxation, contrary to the provisions and purpose of the 1928 Revenue Act. The bookkeeping mingling of corporate earnings and profits made before and after March 1, 1913, does not alter the Act nor can such action render taxable profits non-taxable. In this case, the distribution of $1,025,000 was “properly chargeable to capital account” and was not paid out of profits earned since March 1, 1913. The $1,025,000, paid for the Company’s stock, cannot, therefore, be considered “for the purpose of determining the taxability of subséquent distributions by the corporation” and this purchase of stock did not exhaust any part of the $330,578.98 profits accumulated since 1913. It follows that the total dividend of 1930 received by petitioners’ decedent is taxable and the judgment of the Court of Claims is Affirmed. Me. Justice Cardozo took no part in the considération or decision of this case. lated profit of the company is capital, . . .” Eisner v. Macomber, 252 U. S. 189, 219 (1919). Cf.: . . income . . . (received) . . . prior to the adoption of the Sixteenth Amendment . . . had become capital prior to the adoption of the Amendment . . .” Old Colony R. Co. v. Commissioner, 284 U. S. 557; and “. . . the accumulated profits, as they stood on March 1, 1913, constituted capital of the company , , ” Helvering v. Canfield, 291 U. S. 163, 167. UNITED GAS CO. v. TEXAS. Syllabus. 123 UNITED GAS PUBLIC SERVICE CO. v. TEXAS et al. APPEAL FROM THE COURT OF CIVIL APPEALS FOR THE THIRD SUPREME JUDICIAL DISTRICT OF TEXAS. No. 13. Argued October 15, 18, 1937. Reargued December 14, 15, 1937.—Decided February 14, 1938. 1. Procedure of a State commission in fixing the rate of a public utility; of a State court of first instance in a review by a trial de novo; and of a state appellate court in reviewing the judgment sustaining the rate,—held consistent with due process under the Fourteenth Amendment. Pp. 128 et seq., 138. 2. It is not the function of this Court, in reviewing a judgment of a state court, to détermine whether the procedure in that court was in accordance with the state law; the final judgment of the state court détermines that it was. P. 139. 3. The power of a State over the procedure of its courts includes the power to require that issues of fact be decided by jury, even in a complicated and difficult case involving the adequacy of a rate fixed for a public utility. P. 139. 4. On a trial of a rate case in which the issue of confiscation was put before a jury on a general charge with respect to the éléments to be considered in determining whether the rate would yield a fair retum on the value of the company’s property used and useful in the public service,—held that the company was not entitled under the Fourteenth Amendment to hâve spécial issues framed and submitted covering some but not ail of the items involved in the détermination. P. 141. 5. This Court will review the findings of fact by a state court (1) where a fédéral right has been denied as a resuit of a finding shown by the record to be without evidence to support it, and (2) where a conclusion of law as to a fédéral right and findings of fact are so intermingled as to make it necessary, in order to pass upon the fédéral question, to analyze the facts, such analysis being made, not to détermine issues of fact arising on conflicting testimony or inference, but to perform this Court’s proper function in deciding the question of law arising upon the findings which the evidence permits. P. 142. 6. Upon a trial of the issue of confiscation, a public utility is not entitled to hâve property not used or useful in its business in- 124 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. cluded in the rate base even though it was so included by the commission that fixed the rate. P. 144. 7. In fixing a rate for the future, the rate-making authority, in its considération of returns from operations, is not limited to a par-ticular year—especially a year of abnormal économie conditions; and similarly, a trial court may consider the results of the utility’s operations for a sériés of years, including those intervening be-tween the time of promulgation of the rate, and the time of trial, and détermine the issue of confiscation in the light of the average return thus shown. P. 145. 8. In estimating what will be the returns from a rate which has not been put into effect, a court is entitled to a reasonable basis for prédiction, especially in view of a contemplated emergence from a period of extreme économie dépréssion. P. 145. 89 S. W. 2d 1094, affirmed. Appeal from the affirmance of a judgment sustaining an order of the Railroad Commission of Texas fixing a rate for the appellant Gas Company in the City of La-redo. The Suprême Court of Texas declined to grant a writ of error. With respect to the validity of a provision of the order making the questioned rate rétroactive, this Court is equally divided. Messrs. John P. Bullington and F. G. Coates for ap-pellant on the reargument. Mr. F. G. Coates, with whom Mr. John P. Bullington was on the brief, for appellant on the original argument. Messrs. Alfred M. Scott and Edward H. Lange, with whom Mr. William McGraw, Attorney General of Texas, was on the brief, for appellees on the reargument and on the original argument. Mr. Chief Justice Hughes delivered the opinion of the Court. Appellant, United Gas Public Service Company, challenges the validity of a rate fixed by the Railroad Commission of Texas for natural gas supplied by appellant for domestic uses in the City of Laredo. 123 UNITED GAS CO. v. TEXAS. Opinion of the Court. 125 The City Council of Laredo, on December 15, 1931, en-acted an ordinance fixing gas rates which included a rate of 40 cents per 1000 cubic feet for domestic consumption, with a provision for a discount of 10 per cent, on payment of bills within ten days, the ordinance to become effective on January 1, 1932. The rate had previously been 75 cents per m. c. f. with a 10 per cent, discount for payment within ten days. The Texas Border Gas Company, which was supplying natural gas to consumers in Laredo, filed an appeal with the Railroad Commission and posted the required supersedeas bond in accordance with the provisions of Articles 6058 and 6059 of the Re-vised Civil Statutes of Texas (1925).1 The condition of 1“Art. 6058. Appeal from city control.—When a city govemment has ordered any existing rate reduced, the gas utility affected by such order may appeal to the Commission by filing with it on such terms and conditions as the Commission may direct, a pétition and bond to review the decision, régulation, ordinance, or order of the city, town or municipality. Upon such appeal being taken the Commission shall set a hearing and may make such order or decision in regard to the matter involved therein as it may deem just and reasonable. The Commission shall hear such appeal de novo. When-ever any local distributing company or concem, whose rates hâve been fixed by any municipal government, desires a change of any of its rates, rentals or charges, it shall make its application to the municipal govemment where such utility is located and such municipal govemment shall détermine said application within sixty days after présentation unless the détermination thereof may be longer deferred by agreement. If the municipal govemment should reject such application or fail or refuse to act on it within said sixty days, then the utility may appeal to the Commission as herein provided. But said Commission shall détermine the matters involved in any such appeal within sixty days after the filing by such utility of such appeal with said Commission or such further time as such utility shall in writing agréé to, but the rates fixed by such municipal govemment shall remain in full force and effect until ordered changed by the Commission. “Art. 6059. Appeal from orders.—If any gas utility or other party at interest be dissatisfied with the decision of any rate, classification, 126 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. the bond was that the Company should refund to the City for the benefit of consumers any excess of rates col-lected “over and above the rates and charges that shall be finally determined to be a fair and reasonable return upon the value of its property used and useful in supply-ing natural gas and natural gas service to the City of Laredo.” Prior to the hearing before the Commission, the South Texas Gas Company, which owned and operated the transmission properties and transported the gas sold to the Texas Border Gas Company at the Laredo city gâte, was made a party to the proceeding. The Texas Border Gas Company applied to the City for an increase of rates and, because of the City’s failure to act, took an appeal to the Commission as the statute provided. The two appeals were Consolidated. The United Gas Public Service Company, a Delaware corporation, entered its appear-ance on both appeals alleging that it had acquired the properties of both companies. The Commission, by order of June 13, 1933, fixed a rate of 55 cents per m. c. f. with a penalty of 10 per cent, for non-payment within ten rule, charge, order, act or régulation adopted by the Commission, such dissatisfied utility or party may file a pétition setting forth the particular cause of objection thereto in a court of competent jurisdiction in Travis County against the Commission as défendant. Said action shall hâve precedence over ail other causes on the docket of a different nature and shall be tried and determined as other civil causes in said court. Either party to said action may hâve the right of appeal; and said appeal shall be at once returnable to the appel-late court, and said action so appealed shall hâve precedence in said appellate court of ail causes of a different character therein pending. If the court be in session at the time such right of action accrues, the suit may be filed during such term and stand ready for trial after ten days notice. In ail trials under this article the burden of proof shall rest upon the plaintiff, who must show by clear and satisfactory evidence that the rates, régulations, orders, classifications, acts or charges complained of are unreasonable and unjust to it or them.” 123 UNITED GAS CO. v. TEXAS. Opinion of the Court. 127 days, and the order was made rétroactive to January 1, 1932. 2 P. U. R. (N. S.) 503. The United Gas Public Service Company then brought suit in the District Court of the United States for the Southern District of Texas to restrain the enforcement of the Commission’s order. On July 26, 1933, the State of Texas, the members of the Commission and the City in-stituted the présent suit in the District Court of Travis County in the nature of an appeal under Article 6059 2 for the purpose of protecting the jurisdiction of the state court and of enforcing the Commission’s order if deter-mined to be valid. The state court thereupon stayed ail proceedings by the Commission, or by the officiais of the State and City, to enforce the Commission’s order until the détermination of the suit. On August 1, 1933, the District Court of the United States composed of three judges, 28 U. S. C. 380, stayed ail proceedings in that court pending the final détermination of the suit in the state court. Subject to the order of the state court, the Company has continued to charge its 75 cent rate. The trial in the state court resulted in a judgment on April 24, 1934, which sustained the Commission’s order of June 13, 1933, except so far as its rate was made rétroactive to January 1,1932, that part of the order being held invalid. The Company then appealed to the Court of Civil Appeals, which rendered its judgment on October 30, 1935, reforming the judgment of the trial court so as to déclaré the rétroactive portion of the Commission’s order valid and enforceable and affirming the judgment as thus modified. 89 S. W. (2d) 1094. The Suprême Court of the State refused writ of error. A motion to dismiss the appeal taken to this Court from the judgment of the Court of Civil Appeals was denied. 301 U. S. 667. Upon hearing, the Court ordered reargu 2See Note 1. 128 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. ment, noting that it especially desired to hear the parties on the state of the evidence as to the effect of the application of the Commission^ rate to the years 1932 and 1933, that is, as to the revenues and expenses for those years on that basis, and as to the effect upon the rights of the appellant, with respect to those years, of the bond given on its appeal to the Commission. 302 U. S. 647. Reargument has been had accordingly. Appellant, invoking the due process and equal protection clauses of the Fourteenth Amendment of the Fédéral Constitution, contends that in the state proceedings it has been denied procédural due process and also that the prescribed rate is confiscatory. The proceedings before the Commission and its rulings. The Commission gave a full hearing. It received vol-uminous evidence offered by appellant and the City as to every phase of the controversy and their counsel were fully heard in argument. The opinion of the Commission reviews the history of the utility from the time that the Texas Border Gas Company received its franchise from the City in 1909. The Commission found the interrelation of the companies concerned and that the présent appellant, which had become the owner of the properties of the former operating companies, was itself a unit of the United Gas System. It was in view of the “interre-lated company operation and ownership,” that the gather-ing, transmission and distribution properties used and use-ful in serving the city of Laredo were valued as a com-bined property. As consumers in a number of other com-munities within the Laredo area were also served, it be-came necessary to allocate to Laredo its appropriate proportion. Methods of allocation were submitted by the respective parties and the Commission adopted a weighted average per cent., which had been taken by the City’s engineer as an approximate mean between two percent-ages used by the Company’s engineer, as coming the UNITED GAS CO. v. TEXAS. 129 123 Opinion of the Court. closest to a fair and correct allocation. Evidence of his-torical cost and of reproduction cost new less dépréciation was submitted. The Company’s appraisal on the basis of reproduction cost new, less dépréciation, was $1,231,601. The appraisal of the City’s engineer on the same basis was $810,698. The City adduced evidence showing the depreciated historical cost as of July 31, 1932, to be $709,991.23. The Commission for the purpose of its valuation di-vided the properties into three groups, (a) gathering System, (b) transmission System, and (c) distribution System. The Commission stated and considered the respective appraisals of each group. While the City in-cluded an allowance of $124,668 as the depreciated cost of that portion of the transmission lines extending from Pescadito Junction to the Jennings Field, a distance of about 26 miles, the Commission found “that this line was used only one day during the twelve months’ period end-ing July 31, 1932, in transporting gas to Laredo,” and further that “the condition of this line is such that it could neither safely nor profitably transport the necessary volume of gas to the City.” The Commission concluded that, if the Company’s properties were reproduced, that section of the line would not be necessary. The Commission then considered the questions of work-ing capital, of going concern value and of accrued dépréciation. After referring to the respective estimâtes, the Commission decided that “the over-all per cent, condition” of the properties was 78 per cent. The Commission’s conclusion was that the total “présent fair value” of the properties was $885,000. The Commission said: “In arriving at a decision and making an order herein that is deemed by the Commission to be just and reason-able, we hâve carefully and fully considered ail the evidence presented and ail the facts and circumstances re-53383°—38------9 130 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. flected by the record herein; and upon giving due considération to ail the éléments of value inhering in the property involved in this proceeding, hâve valued the Company’s properties as an operating concern, with business attached; hâve made ample allowance for materials and supplies, working cash, and general overheads; and hâve included in such value the Pescadito-Jennings Transmission Line and the West Jennings Gathering System (although the record clearly discloses that these last two named property items are neither being used, nor are they necessary as standby equipment), and we find the présent fair value of the properties of the Company used, and useful in the gathering, transporting and distributing of natural gas within the City of Laredo, Texas, to be in the sum of $885,000.” The Commission fixed the annual dépréciation rate which should be allowed at 3 per cent. The Commission also found that an annual rate of return of 7 per cent, on the présent value of the properties was adéquate. With respect to “available revenue,” the Commission said that the Company had presented a “setup” of operating revenues and expenses for the twelve months’ period ending July 31, 1932, only. On the other hand, the City had presented a similar “setup” covering the years ending June 30, 1929, 1930 and 1931, and for the year ending July 31, 1932—a period of four years. The Commission was of the opinion that the one year ending July 31, 1932, should not be taken as a test period. It was believed to be a matter of common knowledge that “from a general business standpoint the year 1932 was the worst year since 1929.” The City’s exhibit was deemed to show that the fiscal year 1931 was also subnormal, and the Commission concluded that neither that year, nor an average of those two years, should be taken as an adéquate test. The Commission also thought that it would be unfair to the Company to take the year 1930 123 UNITED GAS CO. v. TEXAS. Opinion of the Court. 131 or an average of the three years, 1930, 1931 and 1932, as it appeared that the year 1930 was the best year in point of gross revenues that the Company had experienced since 1928. On the whole, the Commission thought that justice would be done if an average of revenues and ex-penses for the four fiscal years, 1929, 1930, 1931 and 1932, should be taken as the test period for the computation upon which a fair return should be predicated. It had been stipulated by the parties at the outset that a rate of five cents per m. c. f. was a fair and reasonable price of gas at the well. While the Commission did not make spécifie findings with respect to revenues and ex-penses for the years which it took as a basis, it did reject certain allowances for which the Company contended. As to an allowance of a gathering charge in relation to gas purchased from the Carolina-Texas field, the gathering lines in which were the property of an affiliate, the Commission allowed a charge of one-half of one per cent, instead of the one per cent, which the Company sought. With respect to items not particularized by the Commission, we think that it substantially appears from its opinion that the Commission, save as to the items disallowed, accepted the City’s exhibit which covered the revenues and expenses for the four-year period and stated sepa-rately the items contained therein which were deemed to be questionable. The Commission found the rate, for ail domestic uses, of 55 cents per m. c. f., the minimum bill per user per month to be one dollar and the penalty for non-payment within ten days to be 10 per cent., to be “just and reasonable.” The Commission found that its application would produce “a net return in excess of seven per cent (7%) per annum on the présent fair value of the properties, after provision for operations and reserve for dépréciation.” The Commission ordered that the rate should be effective from and after January 1, 1932, and that there 132 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. should be refunded to the City of Laredo for the benefit of domestic gas consumers the différence between the amount collected under the existing rate and the amount that would hâve been due by consumers under the Com-mission’s order. The proceedings in the District Court of T ravis County.—The trial was essentially de novo. It was begun in March, 1934, and was had before a jury, a motion by the appellants to hâve the jury discharged and the cause de-termined by the court being overruled. The entire record before the Commission was placed in evidence and addi-tional testimony was introduced as to property values, dépréciation reserve accrual, revenues, expenses, rates of return, etc. It appears that the evidence was brought as near as possible to the time of trial. The evidence as to revenues and expenses which appellant adduced again related to the year ending July 31, 1932, and the years 1932 and 1933, and the appellees introduced evidence for the four-year period, to which they had addressed their computations before the Commission, and also for the year 1933. At the close of the evidence, appellant moved for a peremptory instruction in its favor and also for the suspension of the Commission’s order for the years 1932 and 1933. These motions were overruled. Appellant then moved to hâve the case submitted to the jury on “spécial issues” and not upon a “spécial charge.” The court stated that in its view its charge was on “spécial issue” and hence complied with the request. The appellant then moved to submit to the jury certain spécial issues which were separately stated ; that is, that the jury should make separate findings as to the values of component parts of appellant’s property during the years 1932 and 1933, re-spectively, also as to the amount of the necessary ma-terials and supplies and cash working capital, and the amount which should be allowed for “going value,” and 123 UNITED GAS CO. v. TEXAS. Opinion of the Court. 133 as to the average cost of gas at the well mouth and the proper annual allowance for the dépréciation reserve. These requests were refused. The trial court submitted to the jury a single spécial issue as follows: “Do you find that the order of the Railroad Commission of Texas bearing date June 13, 1933, providing for a fifty-five cent gas rate to residential consumers within the city of Laredo, Texas, under the facts introduced in evidence before you, is unreasonable and unjust as to défendant, United Gas Public Service Company. An-swer this question ‘yes’ or ‘no’.” The court prefaced that submission with the following définitions and instructions: That by “fair return” was meant that the appellant was entitled to eam a rate “on the présent fair value of its property which it employs for the convenience of the public equal to that generally being made at the same time within the same general part of the country upon in-vestments in other business undertakings which are at-tended by like risks and uncertainties.” That the rate of return should be reasonably sufficient “to assure confidence in the financial soundness of the utility and should be adéquate under efficient and economical management to maintain and support its crédit and enable it to raise money necessary for the proper discharge of its duties.” That by “fair value” was meant “the reasonable worth of the property at this time that is being used and useful in the public service.” That by “used and useful” was meant that it embraces ail the property “actually being used” in that service and also such property as was reasonably necessary to permit “continuons and efficient service.” That by “operation expenses” was meant such expenses as were incurred in the operation of appellant’s property in furnishing gas to the people of Laredo. 134 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. That by “annual dépréciation” was meant the amount per annum that was reasonably necessary to compensate for the wearing out and any necessary replacements and retirements of appellant’s property. That by “reproduction cost new” was meant “the cost to the owner under the conditions which may reasonably be expected to exist if the property were to be reproduced new.” That by “going value” was meant the added value of appellant’s property as a whole, used and useful for serv-ing the City, over the sum of the values of its component parts, by reason of the fact “that it is an operating, as-sembled and established property, functioning with a trained personnel, a co-ordinated plant and property, with customers attached, and its business established.” Referring to the findings of the Commission, and the transcripts of evidence and exhibits, which were before the Commission and had been introduced in evidence, the court told the jury that the same might be considered for the purpose of assisting the jury in determining whether the Commission’s order was unreasonable and unjust and for no other purpose. The court concluded its charge with the following instructions: “You are instructed that the burden of proof is upon the défendant, United Gas Public Service Company, to show by clear and satisfactory evidence that the rate pro-mulgated by the Railroad Commission in its said order of June 13, 1933, is unreasonable and unjust as to it. “You are further instructed that in determining your answer to said issue in the light of ail the evidence introduced in this case the défendant, United Gas Public Service Company, is entitled to receive a fair return at this time on the présent fair value of its property that is used and useful in the public service after first deducting ail necessary operating expenses and a fair and reasonable amount for the annual dépréciation of said property, and 123 UNITED GAS CO. v. TEXAS. Opinion of the Court. 135 that in considering what is a fair value of said property you will take into considération ail éléments of value that hâve been introduced in evidence before you, includ-ing reproduction cost new of said property and the amount of going value (if any) that inheres in said property. “By ‘unreasonable and unjust’ is meant that the rate prescribed and adopted in the said order of the Railroad Commission was so low as to hâve not provided for a fair return upon the fair value of defendant’s property used and useful in supplying the service furnished by the United Gas Public Service Company to the inhabitants within the city of Laredo, Texas.” Appellant took exceptions to the court’s charge and to the refusai of its requests. The jury answered the spécial issue in the négative. Appellant’s motion for judgment non obstante veredicto was denied and judgment was entered. The court in its judgment ruled that the provision in the Commission’s order requiring the refund of the excess collections over the Commission’s rate was a separable part, and as the court was of the opinion that the Commission’s rétroactive application of its rate to January 1, 1932, and the provision for a refund, were invalid, that part of the Commission’s order was set aside without préjudice to the right of the City to recover the excess collections, should that provision be sustained on appeal. The judgment then enjoined appellant from making any charge in excess of the Commission’s rate, with direction for supersedeas pending appeal upon the filing of a described bond. A motion for a new trial, in which appellant again stated its objections to the court’s rulings, was denied. The ruling of the Court of Civil Appeals.—The appel-late court reached the conclusion that appellant had not only failed to establish its claim for reversai, and for judgment in its favor, but that “when viewed in the light 136 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. of the présomption in favor of the validity of the Commis-sion’s rate order, and of the quantum and character of proof required to overcome such presumption, the evidence adduced was insufficient, as a matter of law, to show that the 55^ rate order was either unjust and unreasonable or confiscatory.” In that view, the court added, “ail questions' of practice,” presented by appellant, “go out of the case.” The court noted the fact that the Commission had reluctantly included in the valuation of the property the items of $124,688, representing the Pescadito-Jennings transmission pipe line, and also had “included the West Jennings Gathering System at a value of $10,342”, although the Commission found that these “two property items are neither used nor are they necessary as standby equipment.” The court also said that there was evidence before both the trial court and the Commission which tended to show “the fair value of appellant’s property to be about $700,000; and that a 2% annual accrual for dépréciation would be fair and reasonable.” Referring to the evidence as to operating revenues and expenditures, the court set forth tables based on the computations of an expert accountant of the appellees showing average net revenues for the four-year period and the year 1933. These calculations were on the basis of appellant’s exist-ing 75 cent rate. The court thus stated the criterion which it applied in overruling appellant’s contentions: “The rule is settled that rates are not based upon the results of business of any one year alone, but upon what is estimated as being the average business over a period of years; the future being gauged as nearly as possible by the past expérience. ... It is also the rule that only actual expérience under the rate complained of can fur-nish any real criterion or guide as to the effect of the rate on the business; and that this expérience should be ob-tained by a practical test for such a period of time as UNITED GAS CO. v. TEXAS. 137 123 Opinion of the Court. will under the facts of the particular business détermine the matters which are of doubtful or uncertain influence. In absence of an actual test of the rate, the court on ap-peal must résolve ail doubts against the complaining party; pare down valuations unsparingly; and the rate must appear to be clearly confiscatory, or unjust and un-reasonable before the court should by injunction restrain its enforcement in advance of actual expérience of the practical results of the rate. And while the equal protection, the due course, and the due process clauses of the fondamental laws of both state and nation guard against the taking of, or compelling of the use of private property for public service without just compensation, still they do not assure the public utility the right under ail conditions and circumstances to1 hâve a retum upon the value of the property so used. If actual expérience for a proper period of time under the rate complained of should reveal suflicient reasons, the rate order may then be changed through proper channels.” Proceeding on this principle, the court said : “In the instant case appellant has continuously charged and collected the 750 rate; hence no actual test has been made under the lower 550 rate. An actual test of the lower rate might hâve resulted in a larger return by bring-ing about an increase in appellant’s business, and mani-festly this court would not be warranted in holding that the lower rate was either confiscatory, or unjust and un-reasonable, as a matter of law, in advance of an actual test of the rate; ... So when the property valuation is pared down to this lowest valuation (about $700,000), and doubtful items of expenses are deducted, the net revenues received by appellant under the 750 rate for the year ending December 31, 1933, would afford more than a 11% return. And calculations based on the $700,000 valuation and the estimated différence in revenues be-tween the 550 rate and the 750 rate, show a return of more 138 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. than 7% for the year 1933. But even if the lower rate did not or would not yield a return of 7% for the year 1933, this court would not be warranted in enjoining the enforcement of the rate, because the test period was too short, no actual test was made under the lower rate and the undisputed evidence showed the year to be abnormal.” In concluding its opinion, the court held that the trial court erred in its ruling that the rétroactive provision of the Commission’s order was invalid. The appellate court said that on the appeal to the Commission to review the City’s ordinance, the Commission was authorized to suspend the rate fixed by the City and to require the utility to give a bond “on such terms and conditions as the Commission may direct.” The trial court had refused to re-ceive the bond in evidence but it appeared in the record. The appellate court quoted its condition and noted that the supersedeas bond filed on appeal to that court was similarly conditioned. The court held that the Commission had the power upon determining that the rate fixed by the City’s ordinance was unreasonable to “sub-stitute its own just and reasonable rate therefor, and to make it effective as of date of the city ordinance rate for which it was substituted.” The Court of Civil Appeals then entered judgment sustaining the rétrospective and refund provision of the Commission’s order and affirming the judgment of the trial court as thus modified. First.—The question of procédural due process.—There is no ground for holding that appellant did not hâve a fair hearing before the Commission. Appellant’s evidence was received and weighed; its arguments were heard and considered. The Commission made findings as to the value of appellant’s property, the permissible allowance for dépréciation and the rate of return. The amounts of revenues and expenses for the four years UNITED GAS CO. v. TEXAS. 139 123 Opinion of the Court. which the Commission took as a basis sufficiently appear, as already stated, from the City’s exhibit to which the Commission referred in its opinion. The estimated amount of revenue at the Commission’s rate appears from a simple calculation, applying the rate of return to the rate base after the annual allowance for dépréciation. In the Commission’s procedure there was no lack of the due process required by the Fédéral Constitution. Railroad Commission of California v. Pacific Gas & Electric Co., 302 U. S. 388; Los Angeles Gas Co. v. Railroad Commission, 289 U. S. 287, 304, 305; West Ohio Gas Co. v. Public Utilities Comm’n {No. 1}, 294 U. S. 63, 70. With respect to the proceedings in the state courts, appellant urges that the case was not tried and determined as required by state law, and we are referred to the state statutes and the decisions of the Texas courts as to the proper procedure in the trial court and on appeal. It is not our function, in reviewing a judgment of the state court, to décidé local questions. We are concerned solely with asserted fédéral rights. The final judgment of the state court in the instant case must be taken as determin-ing that the procedure actually adopted satisfied ail state requirements. John v. Paullin, 231 U. S. 583, 585; Lee v. Central of Georgia Ry. Co., 252 U. S. 109, 110; Central Union Co. v. Edwardsville, 269 U. S. 190, 194, 195. As to the requirement of due process under the Fédéral Constitution, appellant contends that it was denied the independent judicial judgment upon the facts and law to which it was entitled. See Ohio Valley Water Co. v. Ben Avon Borough, 253 U. S. 287; Bluefield Water Works Co. v. Public Service Comm’n, 262 U. S. 679; State Corporation Comm’n v. Wichita Gas Co., 290 U. S. 561, 569; St. Joseph Stock Yards Co. v. United States, 298 U. S. 38, 49. The proceeding in the state court undoubtedly purported to afford an independent judicial review. As the Court of Civil Appeals of Texas said in the instant case, the 140 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. trial of the issues whether the rate was unreasonable or con^scatory was “de novo.” Appellant itself recognizes that the trial “was essentially de novo, new and full testi-mony being introduced as to property value, dépréciation reserve accrual, revenues, expenses, rates of return, etc.” Appellant’s evidence was received by the trial court and appellant’s contentions were heard. The question whether due process in the court’s procedure was accorded thus cornes to the mode of trial; that is, (1) the propriety of a trial by jury, and (2) the manner in which the issues were submitted to the jury. We do not fail to appreciate the difficulty in presenting to a jury the complicated issues in a rate case, especially where, as here, the evidence is voluminous, embracing the conflicting valuations of experts and a host of details in appraisals and in accounts of operations, with elaborate tabulations. Even in trials of such cases without a jury the service of a spécial master for the analysis of the details in evidence with respect to values and return has been found advisable. We hâve had abundant occasion to become familiar with the difficulty of such déterminations. But we are not dealing with questions of policy as to procedure. The State is entitled to détermine the procedure of its courts, so long as it provides the requisite due process. And on that question we hâve never held that it is beyond the power of the State to provide for the trial by a jury of questions of fact because they are complicated. Cases at law triable by a jury in the fédéral courts often involve most difficult and complex questions, as, for example, in patent cases at law presenting issues of validity and infringement. See Tucker v. Spalding, 13 Wall. 453, 455; Keyes n. Grant, 118 U. S. 25, 36, 37; Royer v. Schultz Belting Co., 135 U. S. 319, 325; Coupe v. Royer, 155 U. S. 565, 578, 579. Most difficult questions of fact in protracted trials, with much conflicting expert testimony, are not infrequently presented in criminal cases triable by jury. The issue of life or death may be 123 UNITED GAS CO. v. TEXAS. Opinion of the Court. 141 decided in such a case. We hâve held that a State may modify a trial by jury or abolish it altogether, Walker v. Sauvinet, 92 U. S. 90; Maxwell v. Dow, 176 U. S. 581; Frank n. Mangum, 237 U. S. 309, but never that the time-honored method of resolving questions of fact by a jury must be abandoned by a State under compulsion of the Fédéral Constitution. And we find no warrant for such a ruling now. The question remains as to the manner in which the instant case was submitted to the jury. The spécial issue was submitted whether the Commission’s rate was “un-reasonable and unjust as to défendant.” This submission, under the court’s instruction in relation to the import of the phrase “unreasonable and unjust,” covered, as appel-lant conceded at this bar, the issue whether the rate was confiscatory. Appellant did not ask to hâve the issue of confiscation submitted by the use of that précisé term. The question then is as to the déniai of the submission of the particular issues which appellant requested and as to the character of the instructions given by the trial court. The spécial issues which appellant requested were for findings as to the value of component parts of appellant’s property during the years 1932 and 1933 and as to the amounts necessary to cover material and supplies, work-ing capital, going value, and certain other items. It will be observed that these spécial issues did not embrace ail the questions which the jury should consider, as for example, the questions of operating revenues, operating ex-penses and return for the period to which the evidence be-fore the Court appropriately related and not simply for the years 1932 and 1933. If trial by jury was permissible, as we hold it was, we cannot say—putting aside questions of correct practice under the state law not reviewable here— that appellant was entitled under the Fédéral Constitution to hâve spécial issues framed and submitted to the jury, much less that appellant could demand that the particu- 142 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. lar items it mentioned should be singled out and specially passed upon. We consider that question in the light of the total power which the State possesses to provide for jury trials, and for the manner of conducting them, and not with respect to any alleged limitations imposed by state statutes. See Castillo v. McConnico, 168 U. S. 674, 683. We hâve stated at some length, and need not repeat, the general instructions given by the trial court. The jury were instructed as to the right of appellant to receive a fair return on the fair value of its property that is used and useful in the public service and that the jury should take into considération ail éléments of value that had been introduced in evidence, including the reproduction cost new of the property and the amount of going value, if any, that inhered in it. The court defined the terms that it used, such as “fair return,” “fair value,” “used and useful,” “operation expenses,” “annual dépréciation,” “reproduction cost new” and “going value,” and the court explained what would constitute an adéquate rate of return. No instructions were given which could be taken in any sense to conflict with appellant’s fédéral right; on the contrary, the jury, if it duly followed the instructions, could not but enforce that right. Appellant, while objecting to the charge upon grounds that are not impressive, did not submit and request ampli-fied instructions which might hâve aided the jury’s considération. Appellant was apparently content to object to the pertinent instructions that were given, and to a general charge, and to stand upon its limited requests as to spécial issues. Upon such a record we are unable to hold that there was a déniai of fédéral right so far as procédural due process is concerned. Second.—The question of confiscation.—We hâve said that our inquiry in rate cases coming here from a state UNITED GAS CO. v. TEXAS. 143 123 Opinion of the Court. court “is whether the action of the state officiais in the totality of its conséquences is consistent with the enjoy-ment by the regulated utility of a revenue something higher than the line of confiscation.” West Ohio Gas Co. v. Public Utilities Comm’n {No. 1), supra. This Court will review the findings of fact by a state court (1) where a fédéral right has been denied as the resuit of a finding shown by the record to be without evidence to support it, and (2) where a conclusion of law as to a fédéral right and findings of fact are so intermingled as to make it necessary, in order to pass upon the fédéral question, to analyze the facts. Kansas City Southern Ry. Co. v. Albers Commission Co., 223 U. S. 573, 591; Northern Pacific Ry. Co. N. North Dakota, 236 U. S. 585, 593; Norfolk & Western Ry. Co. v. Conley, 236 U. S. 605, 609, 610; Aetna Life Insurance Co. v. Dunken, 266 U. S. 389, 394. We make that analysis, not to détermine issues of fact arising on conflicting testimony or inferences, and thus to usurp the function of the state court as a trier of the facts, but to perform our own proper function in deciding the question of law arising upon the findings which the evidence permits. Kansas City Southern Ry. Co. v. Albers Commission Co., supra. Here, the issues of fact were determined in the trial court. Counsel agréé that under the state practice the Court of Civil Appeals had no authority to make findings of fact. “Where the evidence is without conflict, it may render judgment. But where there is any conflict in the evidence on a material issue, it has no authority to sub-stitute its findings of fact for those of the trial court.” Post v. State, 106 Tex. 500, 501; 171 S. W. 707. The Court of Civil Appeals held not only that appellant had failed to make good its claim that it was entitled to judgment in its favor but that, having regard to the presump-tion in favor of the Commission’s rate order and the clear and satisfactory proof required to overcome such pre- 144 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. sumption, appellant’s evidence was insufficient as matter of law to show that the Commission’s rate was confisca-tory. The reasoning of the Court of Civil Appeals was directed to the decision of those legal questions. Upon the issue of confiscation, the judgment of the trial court was affirmed and thus its finding of fact was not dis-turbed. Separate questions are presented (1) as to the value of appellant’s property and (2) as to its return from operations. As to the first, the Commission found the value to be $885,000. But the Commission stated that this valuation included property which was neither used nor useful. If it be assumed that the Commission in the exercise of its legislative discrétion might include that property in fixing a “reasonable rate,” still appellant would not be entitled to its inclusion on the issue of confiscation. While the evidence as to value was con-flicting, we are unable to conclude that there was not adéquate evidence to sustain a finding that the total property used and useful, after making déductions for the portions not of that sort, was worth not more than $750,000. Appellant complains that the Court of Civil Appeals based its conclusion upon a valuation of “$700,000” which appellant contends is inadmissible, and that the appellate court misapplied the rule as to the burden of proof in holding that the value must be “pared down unsparingly” to that amount. But we must distinguish “between what was said and what was done,” between “dictum and decision,” between reasoning and conclusion. Dayton Power & Light Co. v. Public Utilities Comm’n, 292 U. S. 290, 298, 302. What the appellate court did was to af-firm the judgment of the trial court and if, as we think, a valuation of appellant’s property at $750,000 would hâve, adéquate support in the evidence, we need go no further in relation to that part of the case. 123 UNITED GAS CO. v. TEXAS. Opinion of the Court. 145 With respect to return from operations, the crucial question is whether appellant was entitled to hâve the rate for the future fixed with sole regard to the resuit of operations in the years 1932 and 1933, as appellant con-tends, or it was permissible to fix the rate upon a considération of the returns for a number of years, that is, for the four years prior to July 31, 1932, as taken by the Commission, or for that period and the years 1932 and 1933, as shown by the evidence before the trial court. The Commission held its hearing in the latter part of 1932 and made its order in June, 1933. Apart from the question raised by the rétrospective feature of its order, we think it manifest that in fixing its rate for the future the Commission was not limited to the results of operations for the year ending July, 1932. Not only was that but a single year, but the Commission regarded it as an abnormal year and the propriety of its ruling in that respect is supported by common knowledge of économie conditions at that time. Similarly, the trial court, sitting in the spring of 1934, was not bound to limit its vision to the results of 1932 and 1933. What would happen in the future was necessarily a matter of prophecy. The Com-mission’s rate had not been put into effect and in esti-mating what would be the conséquence of the requirement the court was entitled to a reasonable basis for prédiction, especially in view of a contemplated emergence from a period of extreme dépréssion. As the Court of Civil Appeals observed, the way was open to the appellant to seek a change in the rate on proof of actual expérience. Of course, appellant was entitled to take its chances on appellate review of the trial court’s judgment, but it cannot complain of the delay incident to that review and its case must be judged as it stood before the trial court. We hold that there was no error in taking into considération the results of appellant’s operations for the years 1929 to 1933, inclusive, according to the evidence produced in the 53383°—38--------10 146 OCTOBER TERM, 1937. Black, J., concurring. 303 U. S. trial court, and in determining the issue of confiscation in the light of the average return thus shown. Appellees introduced evidence tending to show that appellant’s operating revenues, calculated on the basis of the 55 cent rate and after deducting the operating ex-penses deemed to be allowable and the annual allowance for dépréciation, for the years ending June 30, 1929, 1930, and 1931, and July 31, 1932, yielded net amounts of $106,815.36, $123,293.02, $91,554.04, and $48,556.88, re-spectively, and for the year 1933, $46,371.85. Appellant contends that on the basis of the 55 cent rate its net operating revenue for 1932 would hâve been but $10,086.25, and for 1933, $18,408.39. We do not think it necessary, so far as concerns the validity of the Commission’s rate in its prospective application, to extend this opinion by stating in detail the contentions pro and con as to these estimâtes, questions which largely relate to the permissi-ble allowances for operating expenses. We are satisfied that if we consider the results of appellant’s operations for the entire period, 1929 to 1933, the evidence was adéquate to support the judgment of the trial court. Third.—With respect to the question of the validity of that part of the Commission’s order which made its rate rétroactive to January 1, 1932, considered in the light of the evidence relating to the intervening period and of the bond given on the appeal to the Commission from the City’s ordinance, this Court is equally divided and the judgment of the Court of Civil Appeals in that relation is accordingly affirmed. Judgment affirmed. Mr. Justice Reed took no part in the considération and decision of this case. Mr. Justice Black, concurring. Although I concur in sustaining the judgment of the court below, I do not agréé that the rights of this Delaware corporation doing business in Texas are derived from the 123 UNITED GAS CO. v. TEXAS. Black, J., concurring. 147 Fourteenth Amendment1 or that the Fourteenth Amend-ment deprives Texas of its constitutional power to détermine the reasonableness of intra-state utility rates in that State. Even applying the Fourteenth Amendment under the prevailing doctrine, I. do not believe that this Court (apart from procédural questions) is called upon to do more than détermine the sole question of confiscation. Any indication by this Court of the value of the company’s property will unjustifiably affect and control subséquent valuations for rate making purposes.2 The record discloses a striking absence of satisfactory evidence of the actual cost of the company’s properties; its funded indebtedness; the actual investments of stock-holders in the company; profits in past years; and the percentage of past profits to actual investment. These matters hâve important bearing upon the issue of confiscation. There is evidence that only a part of the company’s dépréciation reserve, accumulated over and above expenditures for repairs and property maintenance, reaches approximately $500,000—or over 40% to 70% of the various estimated values of ail the company’s assets. In addition appellant has not shown beyond a reasonable doubt that there is an actual investment of stockholders—over and above the amount of borrowed capital—which could be confiscated.3 Appellant has obvi-ously failed to establish ail the éléments necessary to prove beyond a reasonable doubt4 that the rate fixed by the State will resuit in confiscation of its property. 1 See dissent filed in Connecticut General Life Ins. Co. v. Johnson, ante, p. 83. 2 See McCardle n. Indianapolis Water Co., 272 U. S. 400; McCart v. Indianapolis Water Co., 302 U. S. 419; 13 F. Supp. 110;’ 89 F. (2d) 522, 525, 526. 8 Cf. Chicago & G. T. Ry. Co. v. Wellman, 143 U. S. 339;' see dissent in McCart case, supra. 4 Cf. San Diego Land Co. v. National City, 174 U. S. 739, 754; Ogden v. Saunders, 12 Wheat. 213, 270. 148 OCTOBER TERM, 1937. Black, J., concurring. 303 U. S. Operating Expenses.—The record shows that appel-lant is one of many corporate associâtes and affiliâtes connected with the Electric Bond and Share Company and the United Gas System. Practically ail operating expenses appeared as inter-company charges among these associâtes, affiliâtes, etc. Under these circumstances confiscation cannot be established merely by proof that the books of appellant show alleged expenditures purporting to hâve been made by or through its affiliâtes, associâtes, etc. The strong presumption of the validity of these rates—fixed by a State—can be overcome only by proof that each expenditure, alleged to hâve been made or incurred by or through an associate or affiliate, was in fact so made or incurred and was fair and reasonable. Such proof was not made in this case. As an illustration, a witness testifying for the City said that it was impossible for him to ascertain proper operating expenses for the year 1933, because his examination was confined to the South Texas Border Gas Company and the South Texas Gas Company “and ail I saw in support of these items was inter-company invoices, and I was not able or had no way of determining whether items were proper or not.” Since the major part of appellant’s income is absorbed by associated companies in the name of “operating expenses” and by intercorporate transactions, the operations and expenses of these associâtes, affiliâtes, etc., are brought within the field of inquiry. Referring to intercorporate transactions of holding companies, subsidiaries, associâtes, affiliâtes, etc., this Court has said : “It is urged that as these averments were uncontra-dicted they constitute, when taken with the facts previ-ously stated, a prima fade case for the reasonableness of the rate charged. This might well be true were it not for the fact of unity of ownership and control of the pipe line and the distribution System. An averment of negotia-tion and effort to procure a réduction in the Wholesale rate 123 UNITED GAS CO. v. TEXAS. Black, J., concurring. 149 means little in the light of the fact that the negotiators are both acting in the same interest,—that of the holding company which Controls both. Ail of these facts so aver-red in the pleadings would be far more persuasive with respect to the propriety of the rate if the parties were independent of each other and dealing at arm’s length. Where, however, they constitute but a single interest and involve the embarkation of the total capital in what is in effect one enterprise, the éléments of double profit and of th& reasonableness of inter-company charges must necessarïly be the subject of inquiry and scrutiny before the question as to the lawfulness of the retail rate based thereon can be satisfactorily answered. . The argument is made that the proofs de-manded by the Commission will involve an extensive and unnecessary valuation of the pipe-line company’s property and an analysis of its business, and that this burden should not be thrown upon appellant. Whether this is so we need not now décidé. It is enough to say that in view of the relations of the parties, and the power implicit therein arbitrarily to fix and maintain costs as respects the distributing company which do not represent the true value of the service rendered, the state authority is en-titled to a fair showing of the reasonableness of such costs, although this may involve a présentation of evidence which would not be required in the case of parties dealing at arm’s length and in the general and open market, subject to the usual safeguards of bargaining and compétition.” 5 5 Western Distributing Co. v. Public Service Comm’n, 285 U. S. 119, 126, 127. “Purchases are frequently made by a member or members of a System from affiliâtes or subsidiaries, and with comparative infre-quency from strangers. At times obscurity or confusion has been bom of such relations. There is widespread belief that transfers between affiliâtes or subsidiaries complicate the task of rate-making for regulatory commissions and impede the search for truth. Buyer 150 OCTOBER TERM, 1937. Black, J., concurring. 303 U. S. Not only did appellant fail to prove the reasonableness of its intercompany dealings, but it did not—as requested in open court—produce a full list of salaries paid by its associâtes, affiliâtes, etc. It is true that evidence did show that some of the officers of associâtes, affiliâtes, etc., re-ceived from $65,000 to $100,000 a year but there was no proof of the reasonableness of such salaries or of their effect upon appellant’s local gas distribution expenses. This Court has previously declared the importance of salaries in determining the question of confiscation in Chicago & G. T. Ry. Co. v. Wellman, 143 U. S. 339, 345. There it was said : “Of what do these operating expenses consist? Are they made up partially of extravagant salaries; fifty to one hundred thousand dollars to the president, and in like proportion to subordinate officers? Surely, before the courts are called upon to adjudge an act of the législature fixing . . . maximum . . . rates for railroad com-panies to be unconstitutional, . . . they should be fully advised as to what is done with the receipts and earnings of the company. . . . While the protection of vested rights of property is a suprême duty of the courts, it has not corne to this, that the legislative power rests sub-servient to the discrétion of any railroad corporation which may, by exorbitant and unreasonable salaries, or in some other improper way, transfer its earnings into what it is pleased to call ‘operating expenses.’ ” When a public utility chooses to pay out a large part of its “operating expenses” to corporate associâtes, affiliâtes, etc., these payments might conceivably be used to and seller in such circumstances may not be dealing at arm’s length, and the price agreed upoh between them may be a poor criterion of value. Dayton Power & Light Co. v. Public Utilities Comm’n of Ohio, 292 U. S. 290, 295; Western Distributing Co. v. Public Service Comm’n of Kansas, 285 U. S. 119; Smith v. Illinois Bell Téléphoné Co., 282 U. S. 133.” American Téléphoné & Telegraph Co. n. United States, 299 U. S. 232, 239. UNITED GAS CO. v. TEXAS. 151 123 Black, J., concurring. drain the operating company’s income and to inflate the “operating expenses.” Inflated operating expenses inevi-tably lead to inflated rates. Since affiliâtes, associâtes, etc., do not ordinarily deal at “arm’s length” appellant had the burden of proving the faimess and reasonable-ness of ail expenditures made or charged as inter-company transactions. Due Process and Trial by Jury.—Appellant con-tended in the court below that “the submission of this case ... to a jury will deprive this défendant of that character of hearing and trial contemplated under the Constitution and laws of the United States and of the Constitution and laws of the State of Texas.” Appellant here further insists that over appellant’s protest, the court below did submit the cause to a jury “Despite the recognized inability of such a body to deal adequately with proof of that nature . . . , despite appellant’s vigorous protest and efforts to extricate itself from this situation . . The Constitution of the United States does not prohibit trial by jury, but the Seventh Amendment, judicially con-strued as a limitation on the fédéral government,6 pro vides: “In Suits at common law, where the value in con-troversy shall exceed twenty dollars, the right of trial by jury shall be preserved, and no fact tried by a jury shall be otherwise reexamined in any Court of the United States, than according to the rules of the common law.” . This Court said in 18557 that “The words, ‘due process of law,’ were undoubtedly intended to convey the same meaning as the words, ‘by the law of the land’ in Magna Charta.” Again this Court said:8 8 Barron v. Baltimore, 7 Pet. 243, 247 ; Edwards v. Elliott, 21 Wall. 532, 557. 7 Murray’s Lessee v. Hoboken Land & lmp. Co., 18 How. 272, 276. 8 Thompson v. Utah, 170 U. S. 343, 349, 350. 152 OCTOBER TERM, 1937. Black, J., concurring. 303 U. S. “When Magna Charta declared that no freeman should be deprived of life, etc., ‘but by the judgment of his peers or by the law of the land,’ it referred to a trial by twelve jurors. Those who emigrated to this country from Eng-land brought with them this great privilège ‘as their birthright and inheritance, ‘The trial . . . by a jury of one’s country, is justly esteemed one of the principal excellencies of our Constitution; for what greater security can any person hâve in his life, liberty or estate, than to be sure of not being divested of, or injured in any of these, without the sense and verdict of twelve honest and impartial men of his neighborhood? . . .’ ” There is nothing in the letter or spirit of our Constitution or any constitutional amendment, which deprives a state of the right to submit issues of fact to a trial by jury. That Constitution indicates no preference for détermination of facts by judges or masters appointed by judges. On the contrary, our Fédéral Constitution, the State Constitutions, and our national tradition demonstrate a well-established preference for trial by jury. “One of the objections made to the acceptance of the Constitution as it came from the hands of the Convention of 1787 was that it did not, in express words, préserve the right of trial by jury, and that under it, facts tried by a jury could be reëxamined by the courts of the United States otherwise than according to the rules of the com-mon law. The Seventh Amendment was intended to meet these objections, and to deprive the courts of the United States of any such authority.”9 Further, “Upon the reasoning in the case just referred to [The Justices N. Murray, 9 Wall. 274, 278] it would seem to be clear that the last clause of the Seventh Amendment forbids the retrial by this court of the facts tried by the jury in the présent case. . . . 9 Chicago, B. & Q. R. Co. v. Chicago, 166 U. S. 226, 243. 123 UNITED GAS CO. v. TEXAS. McReynolds and Butler, JJ., dissenting. 153 . Even if we were of opinion in view of the evidence that the jury erred in finding that no property right, of substantial value in money, had been taken from the railroad company, by reason of the opening of a Street across its right of way, we cannot, on that ground, réexamine the final judgment of the state court. We are permitted only to inquire whether the trial court pre-scribed any rule of law for the guidance of the jury that was in absolute disregard of the company’s right to just compensation.”10 This cause was tried in the courts of Texas in accordance with regular court procedure applicable to such cases. The facts were submitted to a jury as provided by the constitution and laws of that State, and in harmony with the traditions of the people of this nation. Under these circumstances, no proper interprétation of the words “due process of law” contained in the Fourteenth Amendment, can justify the conclusion that appellant has been deprived of its property contrary to that “due process.” In October, 1877, this Court in Davidson v. New Orléans, 96 U. S. 97, 105—in discussing the Fourteenth Amendment—said: “But however this may be, or under whatever other clause of the Fédéral Constitution we may review the case, it is not possible to hold that a party has, without due process of law, been deprived of his property, when, as regards the issues affecting it, he has, by the laws of the State, a fair trial in a court of justice, according to the modes of proceeding applicable to such a case.” I concur in the affirmance. Separate opinion of Mr. Justice McReynolds and Mr. Justice Butler. Mr. Justice Butler and I are of opinion that the judgment under review should be reversed. We adhéré to the 10 Id., 244, 246. 154 OCTOBER TERM, 1937. McReynolds and Butler, JJ., dissenting. 303 U. S. doctrine announced in Ohio Valley Co. v. Ben Avon Bor-ough, 253 U. S. 287, and often reaffirmed. When rates fixed for a public service corporation by an administrative body are alleged to be confiscatory the Fédéral Constitution requires that fair opportunity be afforded for submit-ting the controversy to a judicial tribunal for détermination upon its own independent judgment both as to law and facts. Here such opportunity has been denied. June 13, 1933, the Texas Railroad Commission directed appellant to observe a new schedule of rates. By bill presented to the United States District Court June 29, 1933, appellant challenged this action as confiscatory. July 26, 1933, the Commission began this proceeding in the state court by filing an original pétition which, among other things, alleged— “Notwithstanding defendant’s remedies are adéquate and complété in the courts of this State, and notwithstanding every constitutional and legal right to which it may be entitled is and will be fully safeguarded and pro-tected in said court, the défendant, nevertheless, elected to and did, on or about the 29th day of June, 1933, file its bill of complaint in the District Court of the United States for the Southern District of Texas, Laredo Division, in a cause entitled, United Gas Public Service Company, plaintiff v. Lon A. Smith, et al., défendants, No. 32 in Equity, and being a cause wherein your défendant is plaintiff and wherein each and ail of your plaintiffs are défendants, except the State of Texas. . . .” “In said action in said United States District Court, United Gas Public Service Company allégés in substance and effect that the order entered by the Railroad Commission of Texas fixed and prescribed a rate confiscatory of its property used and useful in the public service, and alleged that said order is unconstitutional and upon said allégation [obtained] a temporary restraining order out of said court enjoining and restraining your plaintiffs and 123 UNITED GAS CO. v. TEXAS. McReynolds and Butler, JJ., dissenting. 155 each of them (except the State of Texas) from compelling or attempting to compel your défendant to observe said order of said Commission.” “Plaintiffs allégé that the défendant is attempting to évadé the laws of this State and the lawful order of the Railroad Commission of Texas fixing and prescribing rates and charges for the distribution and sale of natural gas within the limits of the City of Laredo, and that in charg-ing a rate in excess of that prescribed by the Railroad Commission, plaintiffs herein, and each of them, are suf-fering irréparable injury, and that there is no adéquate remedy prescribed by the laws of this State which will protect the public interest involved and the rights of plaintiffs herein.” “Plaintiffs are desirous of having the constitutional questions involved in the attack being made by United Gas Public Service Company upon the Commission’s order heard and determined in the courts of this State, and to that end desire this court to enter a stay of pro-ceedings in accordance with the provisions of Section 38 [380*], Title 28, U. S. C. to the end that ail pro-ceedings in the district courts of the United States will be stayed pending a final détermination of this cause in the courts of this State.” * Sec. 380, Title 28 U. S. C. . . It is further provided that if before the final hearing of such application [to a fédéral court for injunction] a suit shall hâve been brought in a court of the State having jurisdiction thereof under the laws of such State, to enforce such statute or order, accompanied by a stay in such State court of proceedings under such statute or order pending the détermination of such suit by such State court, ail proceedings in any court of the United States to restrain the execution of such statute or order shall be stayed pending the final détermination of such suit in the courts of the State. Such stay may be vacated upon proof made after hearing, and notice of ten days served upon the attorney general of the State, that the suit in the State courts is not being prosecuted with diligence and good faith. . . .” 156 OCTOBER TERM, 1937. McReynolds and Butler, JJ., dissenting. 303 U. S. “This action is filed in this court in the nature of an appeal under the terms of Article 6059, Revised Civil Statutes, but such appeal is not taken because the plain-tiffs herein are dissatisfied with the rates and charges prescribed in the Commission’s said order, but primarily for the purpose of protecting the jurisdiction of this Court and its venue to hear and finally détermine the matters in controversy and to enforce the said order, if it should be determined to be valid upon final hearing.” The pétition asked: That the défendant appear and answer; that upon final trial the plaintiffs hâve an ap-propriate judgment; that défendant be enjoined from charging any rates other than those fixed by the Commission; also that an order issue staying further pro-ceedings by the Commission pending the termination of this suit, &c. July, 26, 1933, the state court entered a stay order as prayed. August 17, 1933, upon the Commission’s application, the United States District Court ordered that ail proceedings in that court be stayed, pending finâl action by the state court. Under the compulsion indicated, appellant unwillingly appeared in the state court and filed an answer setting up its rights under the Fédéral Constitution. The matter was supposed to stand in that court for hearing de novo. Voluminous evidence was presented by both sides. Notwithstanding appellant’s definite objections and its duly presented requests for adéquate instructions, a single issue was submitted to the jury. “Do you find that the order of the Railroad Commission of Texas bearing date June 13, 1933, providing for a fifty-five cent gas rate to residential consumers within the city of Laredo, Texas, under the facts introduced in evidence before you, is unreasonable and unjust as to défendant, United Gas Public Service Company? Answer this question ‘Yes,’ or ‘No.’ ” The jury answered “No,” and judgment affirming the Commission’s order in part was entered. 123 UNITED GAS CO. v. TEXAS. McReynolds and Butler, JJ., dissenting. 157 The Court of Civil Appeals took the cause for review upon the record made in the District Court. The fol-lowing excerpts from its opinion sufficiently indicate the reasons which moved it partly to sustain and partly to overrule the judgment of the trial court and finally to approve the Commission’s action m toto. “We hâve reached the conclusion that appellant not only failed to establish its claim for reversai and rendi-tion of judgment in its favor, but that when viewed in the light of the presumption in favor of the validity of the Commission’s rate order, and of the quantum and charac-ter of proof required to overcome such presumption, the evidence adduced was insufficient, as a matter of law, to show that the 55^ rate order was either unjust and unreasonable or confiscatory. In view of this conclusion, ail questions of practice presented in ‘Part II.’ of the brief go out of the case.” “In absence of an actual test of the rate, the court on appeal must résolve ail doubts against the complaining party; pare down valuations unsparingly; and the rate must appear to be clearly confiscatory, or unjust and unreasonable before the court should by injunction restrain its enforcement in advance of actual expérience of the practical results of the rate.” “That in advance of any actual test of the practical resuit of the new rate, the court on appeal will not dis-turb the rate where it is based upon conflicting evidence as to valuations of property, or as to any other item used as a basis for the calculation of the rate ; because to do so would merely substitute the findings of the court or jury upon conflicting evidence for that of the Commission, and would therefore permit the court to exercise the legislative function of rate-making. R. R. Commission v. Shupee, 57 S. W. (2d), 295; affirmed 73 S. W. (2d), 505. And that by ‘resolving ail doubts against’ the appellant, ‘and using valuations pared down unsparingly,’ there could 158 OCTOBER TERM, 1937. Counsel for Parties. 303 U. S. hâve been no reasonable doubt in the judicial mind that the 55^ rate was neither confiscatory nor unjust and un-reasonable. Newton v. Consolidated Gas Co., 258 U. S., 165.” Considering the rules which the Court of Civil Appeals declared applicable to the trial, quite evidently appellant had nd adéquate opportunity to submit the law and facts relevant to the controversy to a fair judicial tribunal for détermination according to its own independent judgment. A tribunal required to accept weighty presumptions against a défendant, résolve ail doubts against it, pare down valuations to the utmost and refuse a judgment in its favor when the evidence is conflicting as to valuations or other important éléments, could not reach an independent judgment in respect of the law and facts—could not arrive at a fair judicial détermination. To us the proceedings in the state courts seem an empty show. NEW YORK ex rel. CONSOLIDATED WATER CO. v. MALTBIE et al. APPEAL FROM THE SUPREME COURT OF NEW YORK. No. 380. Argued February 3, 4, 1938.—Decided February 14, 1938. A public utility in New York, complaining of an order reducing its rates, sought a review by certiorari, which under the state practice is limited to questions of law. Held: 1. That it had no standing to say that the limitation deprived it of due process of law. P. 160. B 2. That of the questions of law presented, including the question whether there was evidence to sustain the findings of fact made by the rate-fixing body, none was a substantial fédéral question. Id. Appeal from 275 N. Y. 357; 9 N. E. 2d 961, dismissed. Mr. Thayer Burgess, with whom Mr. George H. Kenny was on the brief, for appellant. N. Y. ex rel. WATER CO. v. MALTBIE. 159 158 Opinion of the Court. Mr. Gay H. Brown, with whom Mr. Wendell P. Brown was on the brief, for appellees. Per Curiam. In a proceeding before the Public Service Commission of the State of New York relating to rates for water sup-plied by appellant to the City of Utica and adjacent com-munities, the Commission, on June 28, 1933, after full hearing and upon findings determining the fair value of the property of appellant used and useful in rendering service to its customers, the amount of annual operating income required to yield a six per cent, return upon such fair value, and the average operating income of the company for the years 1930 and 1931 (as adjusted to allow for additional expense), directed appellant to file a sched-ule of rates which should effect a réduction in its annual operating revenues of at least $120,000 per annum. The Commission denied a rehearing with permission to apply for an increase of rates if, after a reasonable time, it should appear that a definite change in prices had occurred. In certiorari proceedings, appellant challenged these déterminations and orders as unlawful and confiscatory, in violation of the due process and equal protection clauses of the Fourteenth Amendment of the Constitution of the United States. The Appellate Division, Third Department, of the Suprême Court of the State, sustained the action of the Commission, 245 App. Div. 866; 282 N. Y. S. 412, and the Court of Appeals affirmed the order of the Appellate Division. 275 N. Y. 357; 9 N. E. 2d 961. The case cornes here on appeal which appellees move to dismiss for the want of jurisdiction upon the ground that no substantial fédéral question is involved. 1. Appellant contends that it is entitled to the exercise of the independent judgment of a court as to the law and the facts with respect to the issue of confiscation and that 160 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. such a review has not been accorded because of the limitations imposed by the State practice in certiorari pro-ceedings. 275 N. Y. at p. 370; 9 N. E. 2d 961. Appellant has no standing to raise this question as appellant itself sought review by certiorari and has not invoked the plenary jurisdiction of a court of equity and it does not appear that this remedy is not available under the State law. Matter of Pennsylvania Gas Co. v. Public Service Comm’n, 211 App. Div. 253, 256; 207 N. Y. S. 599; Matter of New Rochelle Water Co. v. Maltbie, 248 App. Div. 66, 70; 289 N. Y. S. 388. 2. Upon the review of the Commissioû’s orders by certiorari, only questions of law were open under the state practice, including the question whether there was evidence to sustain the findings of the Commission. 275 N. Y. at p. 366; 9 N. E. 2d 961. In that view no sub-stantial fédéral question is presented. Cedar Rapids Gas Co. v. Cedar Rapids, 223 U. S. 655, 668-670; Interstate Commerce Comm’n v. Louisville & Nashville R. Co., 227 U. S. 88, 91, 92; New York ex rel. New York & Queens Gas Co. v. McCall, 219 N. Y. 84, 88-90; 245 U. S. 345, 348, 349. The motion to dismiss is granted. Dismissed. Mr. Justice Cardozo took no part in the considération and decision of this case. N. Y. LIFE INS. CO. v. GAMER. 161 Argument for Petitioner. NEW YORK LIFE INSURANCE CO. v. GAMER, EXECUTRIX. CERTIORARI TO THE CIRCUIT COURT OF APPEALS FOR THE NINTH CIRCUIT. No. 323. Argued January 13, 1938.—Decided February 14, 1938. A life insurance company stipulated to pay double indemnity (twice the face of the policy) upon receipt of due proof that death of the insured resulted, directly and independently of ail other causes, from bodily injury effected solely through extemal, violent and accidentai means, but that double indemnity should not be payable if the death resulted from self-destruction. The insured died of a rifle shot. In an action on the policy in which only the right to the additional payment was in controversy, the issue raised by the pleadings was whether the death was accidentai, the company claiming suicide. Held: 1. That the burden was upon the plaintiff to prove by a prépondérance of the evidence that the death was accidentai. P. 171. 2. -The presumption that the death was due to accident rather than suicide lost its application to the case when evidence was introduced sufficient to sustain a finding that death was not due to accident. Id. 3. This presumption requiring the inference of accident rather than suicide in a case of violent death is a rule of law; it is not evidence and may not be given the weight of evidence. Id. Travellers’ Insurance Co. v. McConkey, 127 U. S. 661, distin-guished. 90 F. (2d) 817, reversed. Certiorari, 302 U. S. 670, to review the affirmance of a judgment recovered by the présent respondent in an action on a life insurance policy. See also 76 F. (2d) 543. Mr. J. A. Poore, with whom Messrs. M. S. Gunn and Charles R. Leonard were on the brief, for petitioner. The physical facts show suicide. It is unnecessary to show motive. New York Life Ins. Co. v. Trimble, 69 F. (2d) 849, 851 ; Aetna Life Ins. Co. v. Tooley, 16 F. (2d) 243, 244; Burkett v. New York Life Ins. Co., 56 F. (2d) 53383°—38--------11 162 OCTOBER TERM, 1937. Argument for Petitioner. 303 U. S. 105, 107, 108; but in the record there is evidence of motive. Surmise or conjecture of accident will not sustain the judgment. Pennsylvania Ry. Co. v. Chamberlain, 288 U. S. 333; New York Life Ins. Co. v. Anderson, 66 F. (2d) 705, 709; Frankel v. New York Life Ins. Co., 51 F. (2d) 933, 935; Aetna Life Ins. Co. v. Tooley, 16 F. (2d) 243, 245; New York Life Ins. Co. v. Alman, 22 F. (2d) 98, 101; Burkett v. New York Life Ins. Co., 56 F. (2d) 105, 108; Stevens v. White City, 285 U. S. 195. The District Court should hâve sustained the motion for a directed verdict for the défendant. The complaint allégés that the death of the insured “resulted directly and independently of ail other causes from bodily in jury effected solely through external, violent and accidentai' means and . . . that the death of said insured did not resuit from self-destruction (but) resulted directly from the accidentai discharge of a fire-arm, to-wit : a rifle. . . The answer déniés that the death of insured resulted from the accidentai discharge of a rifle, and allégés that the death of the insured resulted from self-destruction. This is not a suit for death, but for death by accident. The défendant at ail times offered to pay the death claim, and tendered the money in exchange for a full release, which was refused. The burden is upon-the plaintiff to prove her cause of action, “death by accident,” which proof would négative death by intention. U. S. Fidelity & Guaranty Co. v. Blum, 270 Fed. 946; Travelers’ Ins. Co. v. Wilkes, 76 F. (2d) 701; (International Life Ins. Co. v. Carroll, 17 F. (2d) 42, 43, distinguished) ; Jefferson Standard Life Ins. Co. v. Clemmer, 79 F. (2d) 724; Fédéral Life Ins. Co. v. Zebec, 82 F. (2d) 961, 963; New Amsterdam Casualty Co. N. Breschini, 64 F. (2d) 887, 890; Fidelity & Casualty Co. v. Driver, 79 F. (2d) 713, 714. 161 N. Y. LIFE INS. CO. v. GAMER. Argument for Petitioner. 163 It seems clear that if the plaintiff must show death by accident, it must négative death by intentional means, such as suicide; and if the défendant must prove death by suicide, it must likewise négative death by accident. Travelers’ Insurance Co. v. McConkey, 127 U. S. 661, distinguished. The cause of death being unexplained, a presumption arises in accordance with human expérience that it was not caused by suicide, and this presumption temporarily aided the plaintiff on whom was the burden of persuasion. This required the défendant to go forward with its evidence, or the issue of suicide would go against it, but did not place the burden on défendant of proving suicide, or change the burden of proof resting on the plaintiff. Mobile v. Turnipseed, 219 U. S. 35. The proper construction and interprétation to be placed upon the McConkey case has given rise to much con-trariety of opinion. See Jefferson Standard Life Ins. Co. v. Clemmer, 79 F. (2d) 724, 731. The Circuit Court of Appeals erred in sustaining the instructions to the jury that the presumption of law is that the death was not voluntary; that this presumption has the weight and effect of evidence, and is bind-ing on the jury and they must find according to the presumption until it is overcome by evidence, and that the burden of overcoming such presumption is on the de-fendant. Mobile v. Turnipseed, 219 U. S. 35; Western & A. R. Co. v. Henderson, 279 U. S. 639; Heiner v. Donnan, 285 U. S. 312; Atlantic Coast Line R. Co. v. Ford, 287 U. S. 502; Del Vecchio v. Bowers, 296 U. S. 280. [Citing many cases in the Circuit Courts of Appeals, including Ariasi v. Orient Insurance Co., 50 F. (2d) 548, from the Ninth Circuit.] Also: Thayer, Pre-liminary Treatise on Evidence, pages 314, 336, 337, 339; 5 Wigmore on Evidence, 2d ed., §§ 2487-2498, and chap. 88; Jones’ Commentaries on Evidence, 2d ed. 1926, §§ 30, 256. 164 OCTOBER TERM, 1937. Argument for Respondent. 303 U. S. Mr. William Meyer, with whom Mr. Francis P. Kelly was on the brief, for respondent. It is our contention that upon the trial plaintiff was required to prove that Gamer died on the morning of April lOth and that he died as a resuit of external and violent means. This proof was then aided by the pre-sumption of law that his death was accidentai, which, in the absence of contradictory proof, was sufficient to take the case to the jury. The evidence in this case was sufficient to take the case to the jury, if indeed it did not justify a directed verdict for plaintiff. Gunning v. Cooley, 281 U. S. 90; Small Company v. Lamborn, 267 U. S. 248; Murray Co. v. Harrill, 51 F. (2d) 883, 884; Pythian Knights v. Beck, 181 U. S. 49. See also, Missouri State Life Ins. Co. v. West, 67 F. (2d) 468; Fidél-ity & Casualty Co. v. Pittinger, 63 F. (2d) 880; Home Benefit Assn. v. Sargent, 142 U. S. 691; Gamer v. New York Life Ins. Co., 76 F. (2d) 543. It is generally held that the defense that death re-sulted from causes which by the terms of the policy relieve the insurer from liability, is an affirmative defense, to be alleged by insurer in its answer. Sullivan-v. Metropolitan Life Ins. Co., 96 Mont. 254, 266; 29 P. (2d) 1064; Kingsland v. Metropolitan Life Ins. Co., 97 Mont. 558, 569; 37 P. (2d) 335; Vicars N. Aetna Life Ins. Co., 158 Ky. 1; 164 S. W. 106; Dènt v. National Life & Accident Ins. Co., 6 S. W. (2d) 195; American Central Life Ins. Co. v. Alexander, 39 S. W. (2d) 86. It is for the jury to décidé whether death was accidentai, as neither suicide nor murder will be presumed from the killing of an individual. McClur v. New York Life Ins. Co., 50 F. (2d) 972; Metropolitan Life Ins. Co. v. Broyer, 20 F. (2d) 818, 820; Wells Fargo Co. v. Mutual Life Ins. Co., 66 F. (2d) 890, 893; Connecticut Life Ins. Co. v. Maher, 70 F. (2d) 441. The decision upon the first appeal is now the law of the case. 161 N. Y. LIFE INS. CO. v. GAMER. Opinion of the Court. 165 Travelers’ Insurance Co. v. McConkey, 127 U. S. 661, has not been disapproved by this Court. [Counsel invited attention to certain statu tes of Montana defining presumption, and to Montana decisions; State N. District Court, 72 Mont. 213; 232 Pac. 201, 203 (3) ; Arnold v. Genzberger, 31 P. (2d) 296, 305; Renland v. First National Bank, 90 Mont. 424; 4 P. (2d) 488; McMahon v. Cooney, 95 Mont. 138; 25 P. (2d) 131; Nichols v. New York Life Ins. Co., 88 Mont. 132, 292 Pac. 253; Maki v. Murray Hospital, 91 Mont. 251; 7 P. (2d) 228, 232; State v. Nielson, 57 Mont. 137; 187 Pac. 639 ; Union Bank & Trust Co. v. State Bank, 103 Mont. 260; 62 P. (2d) 677, 684; also to many California cases.] Mr. Justice Butler delivered the opinion of the Court. April 10, 1933, the deceased died by gunshot. Petitioner had insured his life by a policy in which it agreed to pay his executors ten thousand dollars upon proof of death without regard to its cause, or twenty thousand dollars in case of death resulting from accident as de-fined by a provision the pertinent parts of which follow. “The Double Indemnity . . . shall be payable upon re-ceipt of due proof that the death of the Insured resulted directly and independently of ail other causes from bodily injury effected solely through external, violent and accidentai means . . . Double Indemnity shall not be payable if the Insured’s death resulted from self-destruction, whether sane or insane.” Respondent sued petitioner in a state court for twenty thousand dollars. There being diversity of citizenship, défendant removed the case to the fédéral court for the district of Montana. The complaint allégés that the death of the insured resulted directly and independently of ail other causes from bodily in jury effected solely through external, violent and accidentai means and did not resuit from self-destruction but directly from the accidentai discharge of a rifle. 166 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. Defendant’s answer concédés that plaintiff is entitled to the face of the policy, and allégés a deposit of that amount with interest in court. It déniés that death re-sulted from bodily injury effected through accidentai means; and specifically déniés that it resulted from the accidentai discharge of a rifle or other fire-arm. And “as an affirmative defense,” it allégés that the death of the insured resulted from self-destruction by intentionally discharging a loaded rifle into his body with intent to take his life. The case came on for trial and, at the close of the evidence, the judge on motion of défendant directed the jury to return a verdict in its favor. Plaintiff appealed; the circuit court of appeals held that the question whether the death was accidentai should hâve been submitted to the jury, and reversed the judgment. 76 F. (2d) 543. At the second trial plaintiff went forward; at the close of ail the evidence défendant requestëd the court to direct a verdict in its favor, insisting that plaintiff had failed to prove accidentai death and that the evidence showed death was caused by self-destruction, and was not suf-ficient to sustain a verdict for the plaintiff. The court denied the motion and submitted the case to the jury. Its charge contained the following: “In this case the défendant allégés that the death of E. Walter Gamer was caused by suicide. The burden of proving this allégation by a prépondérance, or greater weight of the evidence is upon the défendant. The pre-sumption of law is that the death was not voluntary and the défendant . . . must overcome this presumption and satisfy the jury by a prépondérance of the evidence that his death was voluntary. “Ordinarily ... in the absence of a plea by the défendant of suicide or self-destruction the burden would be upon, and it still is upon the plaintiff in this case to prove that Walter Gamer died from external, violent and acci- 161 N. Y. LIFE INS. CO. v. GAMER. Opinion of the Court. 167 dental means, but by its answer . . . the . . . Company has admitted that . . . [he] died through external and violent means. . . . The question remains as to whether the death was accidentally caused, or the meanS of the death was accidentai or whether it was suicide. But when the défendant took the position that it takes here it assumed the burden of proving to you by a prépondérance of the evidence that Walter Gamer killed himself voluntarily. . . . “The presumption of law is that the death was not voluntary and the défendant in order to sustain the issue of suicide . . . must overcome this presumption and sat-isfy the jury, by a prépondérance of the evidence, that his death was voluntary . . .” The jury gave plaintiff a verdict for twenty thousand dollars with interest, and the court entered judgment in her favor for that amount. Défendant appealed, alleging that the trial judge erred in denying its motion for a di-rected verdict and in giving each of the quoted instructions. The circuit court of appeals affirmed. 90 F. (2d) 817. This Court granted a writ of certiorari. There are presented for decision, questions whether the trial court erred in refusing to direct a verdict for défendant or in giving any of the instructions quoted above. The circuit court of appeals has twice held the evidence sufîicient to sustain a verdict for plaintiff. It found that the facts brought forward at the second trial are not sub-stantially different from those presented on the first ap-peal. There is no substantial controversy as to the principal evidentiary circumstances upon which dépends decision of the controlling issue, whether the death of the insured was accidentai. As we are of opinion that the trial court erred in giving the challenged instructions, and the judgment is to be reversed and the case remanded to the district court where another trial may be had, we 168 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. refrain from discussion of the evidence. We find it suffi-cient to sustain a verdict for or against either party. De-fendant was not entitled to a mandatory instruction. The form and substance of the challenged instructions suggest that the trial judge followed those brought be-fore this Court in Traveïlers’ Ins. Co. v. McConkey, 127 U. S. 661. The opinion of the circuit court of appeals reads that case to require approval of the instructions here in question. As it has not been uniformly inter-preted, we shall examine its principal features. There the accident policy sued on covered bodily injuries effected through external, violent and accidentai means when such injuries alone occasioned death or disability. A proviso declared that no claim should be made under the policy when the death or injury had been caused by suicide, or by intentional injuries inflicted by the insured or by any other person. The complaint alleged that the insured had been accidently shot by a person or persons unknown to plaintiff, by reason of which he instantly died. The answer denied that death was occasioned by bodily injuries effected through external, violent and accidentai means, and alleged that it was caused by suicide, or by intentional injuries inflicted either by the insured or by some other person. The statement of the case quotes the following instructions (pp. 663-664) : “The plaintiff . . . gives evidence of the fact that the insured was found dead . . . from a pistol shot through the heart. This evidence satisfies the terms of the policy with respect to the fact that the assured came to his death by ‘external and violent means,’ and the only question is whether the means by which he came to his death were also ‘accidentai.’ “It is manifest that self-destruction cannot be pre-sumed. . . . The plaintiff is therefore entitled to recover unless the défendant has by competent evidence overcome 161 N. Y. LIFE INS. CO. v. GAMER. Opinion of the Court. 169 this presumption and satisfied the jury by a prépondérance of evidence that the injuries which caused the death of the insured were intentional on his part. “Neither is murder to be presumed . . .; but if the jury find . . . that the insured was in fact murdered, the death was an accident as to him ... If . . . the injuries of the insured . . . were not intentional on his part the plaintiff has a right to recover. . . . The inquiry . . . is resolved into a question of suicide, because if the insured was murdered the destruction of his life was not intentional on his part. “The défendant, in its answer, allégés that the death of the insured was caused by suicide. The burden of proving this allégation by a prépondérance of evidence rests on the défendant.” This Court held that the trial judge erred in charging that if the insured was murdered plaintiff was entitled to recover and on that ground reversed the judgment and remanded the case with directions to grant a new trial. It was not necessary to consider any other question. But, for guidance of the trial ordered, the Court discussed other parts of the charge. At the outset the opinion déclarés that under the issue presented by the general déniai it was incumbent on plaintiff to show that the death was the resuit not only of extemal and violent, but also of accidentai means. It states that the two “principal facts to be established were external violence and accidentai means, producing death. The first was established when it appeared that death ensued from a pistol shot through the heart of the insured. The evidence on that point was direct and positive; . . . Were the means by which the insured came to his death also accidentai? If he committed suicide, then the law was for the company, because the policy . . . did not extend to . . . self-destruction . . .” The opinion proceeds (p. 667) : “Did the court err in saying to the jury that, upon the issue as to suicide, the 170 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. law was for the plaintiff, unless that presumption was overcome by competent evidence? This question must be answered in the négative. The condition that direct-and positive proof must be made of death having been caused by external, violent, and accidentai means, did not deprive the plaintiff, when making such proof, of the benefit of the rules of law established for the guidance of courts and juries in the investigation and détermination of facts.” The statement just quoted, lacking somewhat of the précision generally found in opinions of the Court pre-pared by its eminent author, has been variously construed. The question it propounds does not fully reflect the substance of the charge which put on the défendant the bur-den of proving suicide by prépondérance of the evidence. However, the opinion shows that the burden was on plaintiff to prove death by accident as defined in the contract. It contains nothing to suggest that the court deemed the issue as to burden of proof arising on general déniai to be affected by defendant’s allégation of suicide. It held that if the insured committed suicide, plaintiff had no claim; that, from the fact of death by violence, accident would be presumed, and that unless the presumption was overcome by evidence the law was for plaintiff. The opinion does not indicate the quantum of proof required to put an end to the presumption. It is consistent with, if indeed it does not support, the rule that the presumption is not evidence and ceases upon the introduction of substantial proof to the contrary. Thayer, Preliminary Treatise on Evidence, p. 346. Mobile, J. & K. C. R. Co. v. Turnip-seed, 219 U. S. 35,43. Western & Atlantic R. Co. v. Hen-derson, 279 U. S. 639, 642, 644. Heiner v. Donnan, 285 U. S. 312, 329. Atlantic Coast Line v. Ford, 287 U. S. 502, 506. Del Vecchio v. Bowers, 296 U. S. 280, 286. Nichols v. New York Life Ins. Co., 88 Mont. 132, 139 et seq.; 292 P. 253. The opinion did not definitely sustain any of 161 N. Y. LIFE INS. CO. v. GAMER. Opinion of the Court. 171 the charges to which it referred. It falls far short of sustaining the instructions challenged in the présent case. Under the contract in the case now before us, double indemnity is payable only on proof of death by accident as there defined. The burden was on plaintiff to allégé and by a prépondérance of the evidence to prove that fact. The complaint alleged accident and negatived self-destruction. The answer denied accident and alleged suicide. Plaintiff’s négation of self-destruction taken with defendant’s allégation of suicide served to narrow the possible field of controversy. Only the issue of accidentai death vel non remained. The question of fact to be tried was precisely the same as if plaintiff merely alleged accidentai death and défendant interposed déniai without more. Travelers’ Ins. Co. N. Wilkes, 76 F. (2d) 701, 705. Fidelity & Casualty Co. v. Driver, 79 F. (2d) 713, 714. Cf. Home Benefit Assn. v. Sargent, 142 U. S. 691. Upon the fact of violent death without more, the pre-sumption, i. e., the applicable rule of law, required the inference of death by accident rather than by suicide. As the case stood on the pleadings, the law required judgment for plaintiff. Travellers’ Ins. Co. v. McConkey, supra, 665. It was not submitted on pleadings but on pleadings and proof. In his charge the judge had to apply the law to the case as it then was. The evidence being sufficient to sustain a finding that the death was not due to accident, there was no foundation of fact for the application of the presumption; and the case stood for decision by the jury upon the evidence unaffected by the rule that from the fact of violent death, there being nothing to show the contrary, accidentai death will be presumed. The presumption is not evidence and may not be given weight as evidence. Despiau v. United States Casualty Co., 89 F. (2d) 43, 44. Jefferson Standard Life 172 OCTOBER TERM, 1937. Black, J., dissenting. 303 U. S. Ins. Co. v. Clemmer, 79 F. (2d) 724, 730. Travelers’ Ins. Co. v. Wilkes, supra, 705. Fidelity & Casualty Co. n. Driver, supra, 714. Frankel v. New York Life Ins. Co., 51 F. (2d) 933, 935. Océan Accident & Guarantee Corp. v. Schachner, 70 F. (2d) 28, 31. But see: New York Life Ins. Co. v. Ross, 30 F. (2d) 80. Tschudi v. Metropolitan Life Ins. Co., 72 F. (2d) 306, 308, 310. Nichols v. New York Life Ins. Co., supra. In determining whether by the greater weight of evidence it has been established that the death of the insured was accidentai, the jury is required to consider ail admitted and proved facts and circumstances upon which the détermination of that issue dépends and, in reaching its decision, should take into account the probabilities found from the evidence to attend the daims of the respective parties. The challenged instructions cannot be sustained. Judgment reversed. Mr. Justice Cardozo and Mr. Justice Reed took no part in the considération or decision of this case. Mr. Justice Black, dissenting. The judgment below rests upon an Insurance policy contract made in Butte, Montana. Plaintiff filed suit for more than $3,000 in a Montana state court, and the Insurance company—because it was not a Montana corporation—was able to remove the suit to the Fédéral District Court. Plaintiff’s judgment in the District Court was affirmed by the Court of Appeals. This Court now reverses plaintiff’s judgment because the District Court instructed the jury that—evidence having established the death of the insured by violent and external means—the law presumed from these facts that the death “was not voluntary and . . . the défendant must overcome this presumption and satisfy the jury by a prépondérance of N. Y. LIFE INS. CO. v. GAMER. 173 161 Black, J., dissenting. the evidence, that his death was voluntary. . . The policy of insurance was a Montana contract and even though the company was able to remove plaintiff’s case to a Fédéral court, I believe the plaintiff’s rights should be determined by Montana law. Under Montana law I believe the above instructions were proper. The Suprême Court of Montana has said:1 “Where, as here, death is shown as thé resuit of externat and violent means and the issue is whether it was due to ^accident or suicide, the presumption is in favor of accident” The majority agréé with the Montana law up to this point, saying: “Upon the fact of violent death without more, the presumption, i. e., the applicable rule of law, required the inference of death by accident rather than by suicide.” At this point, agreement ends between the rule here declared by the majority and the law of Montana. Under Montana law the presumption that violent death was accidentai and not suicidai continues and does not disappear unless the evidence “ail points to suicide . . . with such certainty as to preclude any other reasonable hypothesis” ; and the presumption continues for the jury’s considération except “. . . when the evidence points over-whelmingly to suicide as the cause of death.”2 1 Nichols v. New York Life Ins. Co., 88 Mont. 132, 140; 292 B. 253, 255. 2 Nichols v. New York Life Ins. Co., supra, at 141. In a case involving an action on an insurance policy, in which. the McConkey case, supra, was followed, the Suprême Court of Montana said: “The testimony as to the incidents connected with the death of the insured is slight, but is sufficient to establish the death of insured by extemal and violent means. . . . “. . .if plaintiff had ‘shown by the fair weight of the evidence that the assured came to his death as the resuit of a pistol shot . . ., then the law will présumé that the shot was accidentai, and that it was not inflicted with murderous or suicidai intent. And under 174 OCTOBER TERM, 1937. Black, J., dissenting. 303 U. S. Contrary to this clear statement by the Montana Suprême Court is the different rule clearly announced by the majority here in holding that the presumption disappears after the Insurance company introduced evidence merely “suffi dent to sustain a finding that the death was not due to accident.” This Court does not find that the evidence in this case excludes every other reasonable hypothesis but suicide or that ail of the evidence points “unerringly to suicide as the cause of death.”3 On the contrary the majority opinion States: “We find it [the evidence] sufficient to sustain a verdict for or against either party. Défendant was not en-titled to a mandatory instruction.” It is obvious that the majority here déclaré a rule based neither on Montana law nor fédéral statute. This fédéral judicial rule must none the less be followed in suits on insurance policies tried in fédéral courts. The resuit such circumstances the burden will be upon the défendant to overcome this presumption, and to show that the death was not caused by accidentai means.’ “It is apparent, therefore, that under the great weight of authority plaintiff’s evidence made a prima fade case. As said by this court in numerous decisions, when a prima fade case is made by plaintiff, the défendant must rebut the case so made, or fail in the action.” Withers n. Pacific Mutual Life Ins. Co., 58 Mont. 485, 491, 492, 493, 494; 193 P. 566, 568. “Testimony constituting a mere contradiction of the facts estab-lished presumptively by the prima fade case does not necessarily suffice to overthrow the same. . . . the prima fade case must not only be contradicted but overcome as well. When such case is made, contradictory testimony merely amounts to a conflict in the evidence, with the ultimate facts to be determined by the court or jury, as the case may be.” State v. Nielsen, $7 Mont. 137, 143; 187 P. 639, 640. Cf. Johnson N. Chicago, M. & St. P. Ry. Co., 52 Mont. 73; 155 P. 971. See, Renland v. First National Bank, 90 Mont. 424, 437; 4 P. 2d 488. 3 Cf. Nichols v. New York Life Ins. Co., supra, at 144. • N. Y. LIFE INS. CO. v. GAMER. 175 161 Black, J., dissenting. is that suits on policies for less than $3,000 tried in state courts will frequently be decided by rules different from the rule which govems similar suits tried in fédéral courts because they involve more than $3,000. In an orderly and consistent System of jurisprudence, it is important that the same law should fix and control the right of re-covery on substantially identical contracts made in the same jurisdiction and under the same circumstances. Neither the company nor the policyholder should ob-tain an advantage by the application of a different law governing the contract merely because the case can be removed to a fédéral court. It was to avoid such results—among other reasons— that § 725, U. S. C., Title 28, was passed. It provides: “The laws of the several States, except where the Constitution, treaties, or statutes of the United States other-wise require or provide, shall be regarded as rules of decision in trials at common law, in the courts of the United States, in cases where they apply.” In this case, the law determining the burden of proof as to suicide affects the substantial rights of the parties.4 Substantial rights arising from an Insurance contract are governed by the law of the state where the contract is made.6 Since the court below instructed the jury in accordance with the law of Montana, I do not believe the charge constituted réversible error. Nor can I agréé that we should approve a general rule governing trials in fédéral courts which in my judgment transfers jury junctions to judges. The effect of the decision here is to give the trial judge the right to décidé when suffident evidence has been introduced to take jrom the jury the right to find accidentai death from proof of 4 Cf. Central Vermont Ry. Co. v. White, 238 U. S. 507, 511, 512; New Orléans & N. E. R. Co. v. Harris, 247 U. S. 367, 371, 372. 'Pritchard v. Norton, 106 U. S. 124, 130; Northwestern Mutual Life Ins. Co. v. McCue, 223 U. S. 234, 246, 247. 176 OCTOBER TERM, 1937. Black, J., dissenting. 303 U. S. death by violent and external means. This inevitably follows if the presumption, or right of the jury to infer death by accident, “disappears” whenever the judge be-lieves sufficient evidence of suicide has been introduced. Stripped of discussions of legal formulas designated as “presumptions” and “burden of proof,” the net resuit of thei rule of “disappearing presumptions” is that trial judges in fédéral courts (irrespective of state rules) hâve the power to détermine when sufficient “substantial evidence” has been produced to justify taking from the jury the right to render a verdict on evidence which—had the judge not found it overcome by contradictory evidence— would hâve justified a verdict. The judge exercises this power as a “trier of fact” although evidence, previously introduced and sufficient to support a verdict, has neither been excluded nor withdrawn. Proof of death by external and violent means has uni-formly been held to establish death by accident. The extreme improbability of suicide is complété justification for a finding of death from accident under these circum-stances. While it has been said that this proof of accidentai death was based on “presumption,” in reality— whatever words or formulas are used—what is meant is that a litigant has offered adéquate evidence to establish accidentai death. To attribute this adequacy of proof to a “presumption” does not authorize or empower the judge to say that this “adéquate proof” (identical with legal “presumption”) has “disappeared.” If the evidence offered by plaintiff provides adéquate proof of accidentai death upon which a jury’s verdict can be sustained, mere contradictory evidence cannot overcome the original “adéquate proof” unless the authority having the constitu-tional power to weigh the evidence and décidé the facts believes the contradictory evidence has overcome the original proof. The jury—not the judge—should décidé when there has been “substantial” evidence which overcomes S. C. HWY. DEPT. v. BARNWELL BROS. 177 161 Syllabus. the préviens adéquate proof. Here, this Court holds that at the conclusion of plaintiff’s evidence the jury had adéquate proof upon which to find accidentai death, and which would authorize a verdict that insured died as a resuit of accident, but also holds that, after subséquent contradictory evidence of défendant, the judge (not the jury) could décidé that plaintiff’s adéquate proof (pre-sumption) had “disappeared” or had been overcome by this subséquent contradictory testimony. This took from the jury the right to décidé the weight and effect of this subséquent contradictory evidence. Such a rule gives parties a trial by judge, but does not preserve, in its entirety, that trial by jury guaranteed by the Seventh Amendment to the Constitution. I cannot agréé to a conclusion which, I believe, takes away any part of the constitutional right to hâve a jury pass upon the weight of ail of the facts introduced in evidence. I believe the judgment of the court below should be affirmed. SOUTH CAROLINA STATE HIGHWAY DEPARTMENT et al. v. BARNWELL BROTHERS, INC., ET AL. APPEAL FROM THE DISTRICT COURT OF THE UNITED STATES FOR THE EASTERN DISTRICT OF SOUTH CAROLINA. No. 161. Argued January 4, 1938.—Decided February 14, 1938. 1. In the absence of national législation covering the subject in its relation to interstate commerce, a State, in order to conserve its highways and promote safety thereon, may adopt régulations limiting the weight and width of the vehicles that use them, applicable without discrimination to those moving in interstate commerce and to those moving only within the Stae. P. 184. 2. Such régulations being, in general, within the competency of the State, judicial inquiry into their validity, under the commerce clause as well as under the Fourteenth Amendment, is limited to 53383°—38--------12 178 OCTOBER TERM, 1937. Syllabus. 303 U. S. the question whether the restrictions imposed are reasonably adapted to the end sought. P. 190. In resolving this question, the court can not act as Congress does when, after weighing ail the conflicting interests, State and national, it détermines when and how much the State regulatory power shall yield to the larger interests of a national commerce; nor is it called upon, as are state législatures, to détermine what, in its judgment, is the most suitable restriction to be applied of those that are possible, or to choose that one which in its opinion is best adapted to ail the diverse interests affected. 3. A South Carolina statute prohibits use on the state highways of motor trucks and “semi-trailer” motor trucks wider than 90 inches or heavier, including load, than 20,000 Ibs. A fédéral court en-joined its enfor cernent on specified highways as to vehicles engaged in Interstate commerce. It found that much of the interstate motor-truck traffic normally passing over these highways would be barred from the State if the restrictions were enforced, and concluded, that, in the light of their effect upon interstate commerce, the restrictions were unreasonable. To reach this conclusion, the court weighed conflicting evidence and made its own déterminations as to the weight and width of motor trucks com-monly used in interstate traffic and the capacity of the specified highways to accommodate such traffic without injury to them or danger to their users. It found, among other things, that interstate carriage by motor truck has become a national industry; that a very large proportion of the trucks used in interstate transportation are 96 inches wide and of gross weight, when loaded, of more than 10 tons; that the specified highways constitute a connected System, improved with the aid of fédéral money grants, as a part of a national System; that not gross weight but wheel or axle weight, is the factor to be considered in the préservation of concrète highways; that the vehicles used in interstate commerce are so designed and the pressure of their weight is so distributed by their wheels and axles that gross loads of more than 20,000 Ibs. can be carried over concrète roads without damage to the surface; that the highways in question could sustain without injury a wheel load of from 8000 to 9000 Ibs. or an axle load of double those weights; that the weight limitation of the statute, especially as applied to semi-trailer motor trucks, is unreasonable as a means of preserving the highways and has no reasonable relation to safety of the public using them; and that the width limitation of 90 inches is unreasonable when applied to standard con- S. C. HWY. DEPT. v. BARNWELL BROS. 179 177 Statement of the Case. crete highways of the State, in view of the fact that ail other States permit a width of 96 inches, which is the standard width of trucks engaged in Interstate commerce. Held: (1) That since the adoption of one weight or width régulation rather than another is a legislative not a judicial choice, consti-tutionality is not to be determined by weighing in the judicial scales the merits of the legislative choice and rejecting it if the weight of evidence presented in court appears to favor a different standard. P. 191. (2) The legislative judgment is presumed to be supported by facts known to the législature unless facts judicially known or proved preclude that possibility. Id. (3) In reviewing the présent détermination, this Court must examine the record, not to see whether the findings of the court below are supported by evidence, but to ascertain whether it is possible to say that the legislative choice is without rational basis. Id. (4) Not only does the record fail to exclude that possibility, but it shows affirmatively that there is adéquate support for the legislative judgment. Pp. 192 et seq. 17 F. (2d) 803, reversed. Appeal from a final decree of a district court of three judges which enjoined the South Carolina State High-way Department, the State Public Service Commission and numerous state officers, from enforcing, as against the plaintiffs while engaged in Interstate commerce on certain specified highways, a statute limiting the weight and width of motor trucks and “semi-trailer” trucks. There was a provision in the decree that the injunction should not extend to bridges not strong enough to support heavy trucks or too narrow to accommodate such traffic safely, with a proviso that the State Highway Department should post certain warning notices at such bridges, and should enforce the law against their use by such trucks. The Interstate Commerce Commission and two private corporations were permitted to intervene as plaintiffs, and two railroad companies and the receiver of another were permitted to intervene as défendants. 180 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. Messrs. Steve C. Griffith and Thomas W. Davis, with whom Messrs. John M. Daniel, Attorney General, J. Ivey Humphrey and M. J. Hough, Assistant Attorneys General, of South Carolina, Eugene S. Blease, Douglas McKay, M. G. McDonald, and J. B. S. Lyles were on the briefs, for appellants. Messrs. S. King Funkhouser and Frank Coleman, with whom Mr. J. Ninian Beall was on the brief, for appellees. By leave of Court, briefs of amici curiae were filed by Mr. Otto Kemer, Attorney General of Illinois; Messrs. Hubert Meredith, Attorney General, and M. B. Holifield, Assistant Attorney General, of Kentucky; Messrs. William McCraw, Attorney General, and George P. Kirk-patrick, Assistant Attorney General, of Texas, on behalf of their respective States, in support of appellants; by Solicitor General Reed, Assistant Attorney General Jackson, and Mr. Elmer B. Collins, on behalf of the United States, and by Mr. Cary D. Lundis, Attorney General, on behalf of the State of Florida,—in support of appellees. Mr. Justice Stone delivered the opinion of the Court. Act No. 259 of the General Assembly of South Carolina, of April 28, 1933, 38 Stat. 340, prohibits use on the state highways of motor trucks and “semi-trailer motor trucks” whose width exceeds 90 inches, and whose weight includ-ing load exceeds 20,000 pounds. For purposes of the weight limitation § 2 of the statute provides that a semi-trailer motor truck, which is a motor propelled truck with a trailer whose front end is designed to be attached to and supported by the truck, shall be considered a single unit. The principal question for decision is whether these prohibitions impose an unconstitutional burden upon Interstate commerce. S. C. HWY. DEPT. v. BARNWELL BROS. 181 177 Opinion of the Court. Appellees include the original plaintiffs below, who are truckers and Interstate shippers; the Interstate Commerce Commission; and certain others who were permitted to intervene as parties plaintiff. The suit was brought in the district court for eastern South Carolina against varions state officiais, to enjoin them from enforcing § § 4 and 6 of the Act among others,1 on the ground that they hâve been superseded by the Fédéral Motor Carrier Act of 1935, c. 498, 49 Stat. 546; that they infringe the due proc-ess clause of the Fourteenth Amendment; and that they impose an unconstitutional burden on Interstate commerce. Certain railroads interested in restricting the compétition of Interstate motor carriers were permitted to intervene as parties défendant. The district court of three judges, after hearing evidence, ruled that the challenged provisions of the statute hâve not been superseded by the Fédéral Motor Carrier Act, and adopted as its own the ruling of the state Suprême Court in State ex rel. Daniel v. John P. Nutt Co., 180 S. C. 19; 185 S. E. 25, that the challenged provisions, being an exercise of the state’s power to regulate the use of its highways so as to protect them from injury and to insure their safe and economical use, do not violate the Fourteenth Amendment. But it held that the weight and width prohibitions place an unlawful burden on Interstate motor traffic passing over specified highways of the state, which for the most part are of concrète or a concrète base surfaced with asphalt. It accordingly enjoined the enforcement of the weight provision against Interstate motor carriers on the specified highways, and also 1 “§ 4. Weight.—No person shall operate on any highway any motor truck or semi-trailer truck [sic] whose gross weight, including load, shall exceed 20,000 pounds. “§ 6. Width.—No person shall operate on any highway any motor truck or semi-trailer motor truck whose total outside width, including any part of body or load, shall exceed 90 inches.” 182 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. the width limitation of 90 inches, except in the case of vehicles exceeding 96 inches in width. It exempted from the operation of the decree, bridges on those highways “not constructed with sufîicient strength to support the heavy trucks of modem traffic or too narrow to accommo-date such traffic safely,” provided the state highway department should place at each end of the bridge proper notices warning that the use of the bridge is forbidden by trucks exceeding the weight or width limits and provided the proper authorities take the necessary steps to enforce the law against such use of the bridges. The case cornes here on appeal under § 266 of the Judicial Code. The trial court rested its decision that the statute unreasonably burdens Interstate commerce, upon findings, not assailed here, that there is a large amount of motor truck traffic passing interstate in the southeastem part of the United States, which would normally pass over the highways of South Carolina, but which will be barred from the state by the challenged restrictions if enforced, and upon its conclusion that, when viewed in the light of their effect upon interstate commerce, these restrictions are unreasonable. To reach this conclusion the court weighed conflicting evidence and made its own déterminations as to the weight and width of motor trucks commonly used in interstate traffic and the capacity of the specified highways of the state to accommodate such traffic without injury to them or danger to their users. It found that interstate carriage by motor trucks has become a national industry; that from 85 to 90% of the motor trucks used in interstate transportation are 96 inches wide and of a gross weight, when loaded, of more than ten tons; that only four other States prescribe a gross load weight as low as 20,000 pounds; and that the American Association of State Highway Officiais and the National Conférence on Street and Highway Safety in the Department of S. C. HWY. DEPT. v. BARNWELL BROS. 183 177 Opinion of the Court. Commerce hâve recommended for adoption weight and width limitations in which weight is limited to axle loads of 16,000 to 18,000 pounds and width is limited to 96 inches. It found in detail that compliance with the weight and width limitations demanded by the South Carolina Act would seriously impede motor truck traffic passing to and through the state and increase its cost; that 2,417 miles of state highways, including most of those affected by the injunction, are of the standard construction of concrète or concrète base with asphalt surface, 7% or 8 inches thick at the edges and 6 or 6^ inches thick at the center ; that they are capable of sustaining without injury a wheel load of 8,000 to 9,000 pounds or an axle load of double those amounts, depending on whether the wheels are equipped with high pressure or low pressure pneumatic tires; that ail but 100 miles of the specified highways are from 18 to 20 feet in width; that they constitute a con-nected System of highways which hâve been improved with the aid of fédéral money grants, as a part of a national System of highways; and that they constitute one of the best highway Systems in the southeastern part of the United States. It also found that the gross weight of vehicles is not a factor to be considered in the préservation of concrète highways, but that the appropriate factor to be considered is wheel or axle weight; the vehicles engaged in interstate commerce are so designed and the pressure of their weight is so distributed by their wheels and axles that gross loads of more than 20,000 pounds can be car-ried over concrète roads without damage to the surface; that a gross weight limitation of that amount, especially as applied to semi-trailer motor trucks, is unreasonable as a means of preserving the highways; that it has no rea-sonable relation to safety of the public using the highways; and that the width limitation of 90 inches is un- 184 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. reasonable when applied to standard concrète highways of the state, in view of the fact that ail other States permit a width of 96 inches, which is the standard width of trucks engaged in interstate commerce. In reaching these conclusions, and at the same time holding that the weight and width limitations do not in-fringe the Fourteenth Amendment, the court proceeded upon the assumption that the commerce clause imposes upon state régulations to secure the safe and economical use of highways a standard of reasonableness which is more exacting when applied to the interstate traffic than that required by the Fourteenth Amendment as to ail traffic ; that a standard of weight and width of motor ve-hicles which is an appropriate state régulation when applied to intrastate traffic may be prohibited because of its effect on interstate commerce, although the conditions attending the two classes of traffic with respect to safety and protection of the highways are the same. South Carolina has built its highways and owns and maintains them. It has received from the fédéral gov-ernment, in aid of its highway improvements, money grants which hâve been expended upon the highways to which the injunction applies. But appellees do not challenge here the ruling of the district court that Congress has not undertaken to regulate the weight and size of motor vehicles in interstate motor traffic, and has left un-disturbed whatever authority in that regard the States hâve retained under the Constitution. While the constitutional grant to Congress of power to regulate interstate commerce has been held to operate of its own force to curtail state power in some measure,2 a State régulations affecting interstate commerce, whose purpose or effect is to gain for those within the state an advantage at the expense of those without, or to burden those out of the state without any corresponding advantage to those within, hâve been thought to impinge upon the constitutional prohibition even though Congress S. C. HWY. DEPT. v. BARNWELL BROS. 185 177 Opinion of the Court. it did not forestall ail state action affecting Interstate commerce. Ever since Willson v. Black Bird Creek Marsh Co., 2 Pet. 245, and Cooley v. Board of Port Wardens, 12 How. 299, it has been recognized that there are matters of local concern, the régulation of which unavoidably involves some régulation of Interstate commerce but which, because of their local character and their number and diversity, may never be fully dealt with by Con-gress. Nothwithstanding the commerce clause, such régulation in the absence of Congressional action has for the most part been left to the States by the decisions of this Court, subject to the other applicable constitutional restraints. The commerce clause, by its own force, prohibits discrimination against Interstate commerce, whatever its form or method, and the decisions of this Court hâve recognized that there is scope for its like operation when state législation nominally of local concern is in point of has not acted. Hall v. DeCuir, 95 U. S. 485, 497-498; Wabash, St. L. & P. R. Co. v. Illinois, 118 U. S. 557, 575-578; Bowman v. Chicago & N. W. R. Co., 125 U. S. 465, 498; Western Union Telegraph Co. v. James, 162 U. S. 650, 659, with which compare Western Union Telegraph Co. v. Pendleton, 122 U. S. 347, 358; Foster-Fountain Packing Co. v. Haydel, 278 U. S. 1, with which compare Geer v. Connecticut, 161 U. S. 519, and New York ex rel. Silz v. Hesterberg, 211 U. S. 31; Baldwin v. Seelig, 294 U. S. 511, 524; see Western Union Telegraph Co. v. Kansas, 216 U. S. 1, 27 et seq. Underlying the stated rule has been the thought, often expressed in judicial opinion, that when the régulation is of such a character that its burden falls principally upon those without the state, legislative action is not likely to be subjected to those political restraints which are normally exerted on législation where it affects adversely some interests within the state. See Cooley v. Board of Port Wardens, 12 How. 299, 315; Gilman v. Philadelphia, 3 Wall. 713, 731; Escanaba Co. v. Chicago, 107 U. S. 678, 683; Lake Shore & M. S. R. Co. v. Ohio ex rel. Lawrence, 173 U. S. 285, 294; cf. Pound v. Turck, 95 U. S. 459, 464; Gloucester Ferry Co. v. Pennsylvania, 114 U. S. 196, 205; Robbins v. Shelby County Taxing District, 120 U. S. 489, 499. 186 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. fact aimed at Interstate commerce, or by its necessary operation is a means of gaining a local benefit by throw-ing the attendant burdens on those without the state. Robbins v. Shelby County Taxing District, 120 U. S. 489, 498; Caldwell v. North Carolina, 187 U. S. 622, 626.3 It was to end these practices that the commerce clause was adopted. See Gibbons v. Ogden, 9 Wheat. 1, 187; Brown v. Maryland, 12 Wheat. 419, 438-439; Cooley v. Board of Port Wardens, supra; State Freight Tax, 15 Wall. 232, 280; State Tax on Railway Gross Receipts, 15 Wall. 284, 289, 297-298; Cook v. Pennsylvania, 97 IL S. 566, 574; Maine v. Grand Trunk R. Co., 142 U. S. 217 ; Baldwin v. Seelig, 294 U. S. 511, 522; II Farrand, Records of the Fédéral Convention, 308; III id. 478, 574, 548; The Fed-eralist, No. XLII; 1 Curtis, History of the Constitution, 502; Story on the Constitution, § 259. The commerce clause has also been thought to set its own limitation upon state control of Interstate rail carriers so as to pre-clude the subordination of the effîciency and convenience of Interstate traffic to local service requirements.4 3 Footnote 2, supra. 4 See Illinois Central R. Co. v. Illinois, 163 U. S. 142; Cleveland, C. C. & St. L. R. Co. v. Illinois, 177 U. S. 514; Mississippi Railroad Comm’n n. Illinois Central R. Co., 203 U. S. 335; Atlantic Coast Line R. Co. v. Wharton, 207 U. S. 328; Herndon v. Chicago, R. I. & P. R. Co., 218 U. S. 135; Chicago, B. & Q. R. Co. v. Railroad Commission, 237 U. S. 220; St. Louis Æ San Francisco R. Co. v. Public Service Comm’n, 254 U. S. 535. Cf. Gladson n. Minnesota, 166 U. S. 427; Lake Shore & M. S. R. Co. v. Ohio ex rel. Lawrence, 173 U. S. 285; Gulf, C. & S. F. R. Co. v. Texas, 246 U. S. 58, where statutes requiring local service no greater than necessary for fair accommodation of local needs were held constitutional. Although the states hâve usually been allowed to impose burdens on interstate railroads in the interest of local safety, Smith v. Alabama, 124 U. S. 465; Nashville, C. & St. L. R. Co. v. Alabama, 128 U. S. 96; New York, N. H. & H. R. Co. v. New York, 165 U. S. 628; Chicago, R. I. & P. R. Co. v. Arkansas, 219 U. S. 453; St. Louis, I. M. & S. R. Co. v. Arkansas, 240 U. S. 518; cf. Hennington v. Georgia, 163 U. S. 299, S. C. HWY. DEPT. v. BARNWELL BROS. 187 177 Opinion of the Court. But the présent case affords no occasion for saying that the bare possession of power by Congress to regulate the interstate traffic forces the States to conform to standards which Congress might, but has not adopted, or cur-tails their power to take measures to insure the safety and conservation of their highways which may be ap-plied to like traffic moving intrastate. Few subjects of state régulation are so peculiarly of local concern as is the use of state highways. There are few, local régulation of which is so inséparable from a substantial effect on interstate commerce. Unlike the railroads, local highways are built, owned and maintained by the state or its municipal subdivisions. The state has a primary and immédiate concern in their safe and economical administration. The présent régulations, or any others of like pur-pose, if they are to accomplish their end, must be applied alike to interstate and intrastate traffic both moving in large volume over the highways. The fact that they affect alike shippers in interstate and intrastate commerce in large number within as well as without the state is a safeguard against their abuse. From the beginning it has been recognized that a state can, if it sees fit, build and maintain its own highways, canals and railroads and that in the absence of Congres-sional action their régulation is peculiarly within its compétence, even though interstate commerce is materially affected. Minnesota Rate Cases, 230 U. S. 352, 416. Congress not acting, state régulation of intrastate carriers has been upheld regardless of its effect upon interstate commerce. Id. With respect to the extent and nature of the local interests to be protected and the un-avoidable effect upon interstate and intrastate commerce alike, régulations of the use of the highways are akin to an unnecessarily harsh restriction, even though it is in the interest of safety, has been held to be unconstitutional. Seaboard Air Line Ry. v. Blackwell, 244 U. S. 310. 188 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. local régulation of rivers, harbors, piers and docks, quar-antine régulations, and game laws, which, Congress not’ acting, hâve been sustained even though they materially interfère with interstate commerce.5 6Among the state régulations materially affecting interstate commerce which this Court has upheld, Congress not acting, are those which sanction obstructions in navigable rivers, Willson v. Black-Bird Creek Marsh Co., 2 Pet. 245; Ex parte McNiel, 13 Wall. 236; Pound n. Turck, 95 U. S. 459; Wilson v. McNamee, 102 U. S. 572; Huse n. Glover, 119 U. S. 543; cf. Sands n. Manistee River Improve-ment Co., 123 U. S. 288; approve the érection of bridges over navigable streams, Gilman v. Philadelphia, 3 Wall. 713; Escanaba Co. v. Chicago, 107 U. S. 678; Cardwell v. American River Bridge Co., 113 U. S. 205; Willamette Iron Bridge Co. v. Hatch, 125 U. S. 1; Lake Shore & M. S. R. Co. v. Ohio, 165 U. S. 365; require payment of fees as an incident to use of harbors, Cooley v. Board of Port War-dens, 12 How. 299; Steamship Co. n. Joliffe, 2 Wall. 450; Anderson v. Pacific Coast S. S. Co., 225 U. S. 187; Clyde Mallory Lines v. Ala-bama ex rel. State Docks Comm’n, 296 U. S. 261 ; cf. Mobile County v. Kimball, 102 U. S. 691; control the location of docks, Cummings v. Chicago, 188 U. S. 410; impose wharfage charges, Pocket Co. v. Keokuk, 95 U. S. 80; Pocket Co. v. Catlettsburg, 105 U. S. 559; Transportation Co. n. Parkersburg, 107 U. S. 691; Ouachita Pocket Co. v. Aiken, 121 U. S. 444; establish inspection and quarantine laws, Turner v. Maryland, 107 U. S. 38; Morgan’s S. S. Co. v. Louisiana Board of Health, 118 U. S. 455; Patapsco Guano Co. v. North Caro-lina Board of Agriculture, 171 U. S. 345; Rasmussen n. Idaho, 181 U. S. 198; Smith v. St. Louis & S. W. R. Co., 181 U. S. 248; Reid v. Colorado, 187 U. S. 137; New Mexico ex rel. McLean Æ Co. v. Denver & R. G. R. Co., 203 U. S. 38; Asbell v. Kansas, 209 U. S. 251; Red “C” Oil Mfg. Co. v. Board of Agriculture, 222 U. S. 380; Savage v. Jones, 225 U. S. 501; Pure OU Co. n. Minnesota, 248 U. S. 158; Mintz v. Baldwin, 289 U. S. 346; cf. Railroad Co. v. Husen, 95 U. S. 465; Minnesota v. Barber, 136 U. S. 313; Brimmer v. Reb-man, 138 U. S. 78; and regulate the taking or exportation of domestic game, Geer v. Connecticut, 161 U. S. 519; New York ex rel. Silz v. Hesterberg, 211 U. S. 31; cf. Foster-Fountain Packing Co. v. Haydel, 278 U. S. 1, 13, holding invalid a local régulation ostensibly designed to conserve a natural resource but whose purpose and effect were to benefit Louisiana enterprise at the expense of businesses outside the state. S. C. HWY. DEPT. v. BARNWELL BROS. 189 177 Opinion of the Court. The nature of the authority of the state over its own highways has often been pointed ont by this Court. It may not, under the guise of régulation, discriminate against iriterstate commerce. But “In the absence of national législation especially covering the subject of interstate commerce, the State may rightly prescribe uni-form régulations adapted to promote safety upon its highways and the conservation of their use, applicable alike to vehicles moving in interstate commerce and those of its own citizens.” Morris v. Duby, 274 U. S. 135, 143. This formulation has been repeatedly affirmed, Clark v. Poor, 274 U. S. 554, 557; Sprout v. South Bend, 277 U. S. 163, 169; Sproles v. Binjord, 286 U. S. 374, 389, 390; cf. Morj v. Bingaman, 298 U. S. 407, and never disapproved. This Court has often sustained the exercise of that power although it has burdened or impeded interstate commerce. It has upheld weight limitations lower than those pres-ently imposed, applied alike to motor traffic moving interstate and intrastate.. Morris N. Duby, supra; Sproles v. Binjord, supra. Restrictions favoring passenger traffic over the carriage of interstate merchandise by truck hâve been similarly sustained, Sproles N. Binjord, supra; Bradley v. Public Utilities Comm’n, 289 U. S. 92, as has the exaction of a reasonable fee for the use of the highways. Hendrick v. Maryland, 235 U. S. 610; Kane v. New Jersey, 242 U. S. 160; Interstate Busses Corp. v. Blodgett, 276 U. S. 245; Morj v. Bingaman, supra; cf. Ingels v. Morj, 300 U. S. 290. In each of these cases régulation involves a burden on interstate commerce. But so long as the state action does not discriminate, the burden is one which the Constitution permits because it is an inséparable incident of the exercise of a legislative authority, which, under the Constitution, has been left to the States. Congress, in the exercise of its plenary power to regu-late interstate commerce, may détermine whether the 190 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. burdens imposed on it by state régulation, otherwise per-missible, are too great, and may, by législation designed to secure uniformity or in other respects to protect the national interest in the commerce, curtail to some extent the state’s regulatory power. But that is a legislative, not a judicial function, to be performed in the light of the Congressional judgment of what is appropriate régulation of interstate commerce, and the extent to which, in that field, state power and local interests should be required to yield to the national authority and interest. In the absence of such législation the judicial function, under the commerce clause as well as the Fourteenth Amendment, stops with the inquiry whether the state législature in adopting régulations such as the présent has acted within its province, and whether the means of régulation chosen are reasonably adapted to the end sought. Sproles v. Binford, supra; Stephenson v. Binjord, 287 U. S. 251, 272. Here the first inquiry has already been resolved by our decisions that a state may impose non-discriminatory restrictions with respect to the character of motor vehicles moving in interstate commerce as a safety measure and as a means of securing the economical use of its highways. In resolving the second, courts do not sit as législatures, either state or national. They cannot act as Cbngress does when, after weighing ail the conflicting interests, state and national, it détermines when and how much the state regulatory power shall yield to the larger interests of a national commerce. And in reviewing a state highway régulation where Congress has not acted, a court is not called upon, as are state législatures, to détermine what, in its judgment, is the most suitable restriction to be applied of those that are possible, or to choose that one which in its opinion is best adapted to ail the diverse interests affected. Transportation Co. v. Parkersburg, 107 U. S. 691, 695. When the action of a législature is S. C. HWY. DEPT. v. BARNWELL BROS. 191 177 Opinion of the Court. within the'scope of its power, fairly debatable questions as to its reasonableness, wisdom and propriety are not for the détermination of courts, but for the legislative body, on which rests the duty and responsibility of decision. Jacobson v. Massachusetts, 197 U. S. 11, 30; Laurel Hill Cemetery v. San Francisco, 216 U. S. 358, 365; Price v. Illinois, 238 U. S. 446, 451 ; Hadacheck v. Sébastian, 239 U. S. 394, 408-414; Thomas Cusack Co. v. Chicago, 242 U. S. 526, 530; Euclid v. Ambler Realty Co., 272 U. S. 365, 388; Zahn v. Board of Public Works, 274 U. S. 325, 328; Standard OU Co. v. Marysville, 279 U. S. 582, 584. This is equally the case when the legislative power is one which may legitimately place an incidental burden on Interstate commerce. It is not any the less a legislative power committed to the states because it affects inter-, state commerce, and courts are not any the more entitled, because Interstate commerce is affected, to substitute their own for the legislative judgment. Morris v. Duby, supra, 143; Sproles v. Binford, supra, 389, 390; Minnesota Rate Cases, supra, 399, 400; Smith v. St. Louis & S. W. R. Co., 181 U. S. 248, 257; Reid v. Colorado, 187 U. S. 137, 152; New York ex rel. Silz v. Hesterberg, 211 U. S. 31, 42, 43. Since the adoption of one weight or width régulation, rather than another, is a legislative not a judicial choice, its constitutionality is not to be determined by weighing in the judicial scales the merits of the legislative choice and rejecting it if the weight of evidence presented in court appears to favor a different standard. Cf. Wor-cester County Trust Co. v. Riley, 302 U. S. 292, 299. Being a legislative judgment it is presumed to be sup-ported by facts known to the législature unless facts judi-cially known or proved preclude that possibility. Hence, in reviewing the présent détermination we examine the record, not to see whether the findings of the court below are supported by evidence, but to ascertain upon the whole 192 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. record whether it is possible to say that the legislative choice is without rational basis. Standard Oil Co. v. Mar y s ville, supra; Borden’s Farm Products Co. v. T en Eyck, 297 U. S. 251, 263; s. c. 11 F. Supp. 599, 600. Not only does the record fail to exclude that possibility, but it shows affirmatively that there is adéquate support for the legislative judgment. At the outset it should be noted that underlying much of the controversy is the relative merit of a gross weight limitation as against an axle or wheel weight limitation. While there is evidence that weight stresses on concrète roads are determined by wheel rather than gross load weights, other éléments enter into choice of the type of weight limitation. There is testimony to show that the •axle or wheel weight limitation is the more easily en-forced through resort to weighing devices adapted to as-certaining readily the axle or wheel weight. But it ap-pears that in practice the weight of truck loads is not evenly distributed over axles and wheels; that commonly the larger part of the load—sometimes as much as 70 to 80%—rests on the rear axle and that it is much easier for those who load trucks to make certain that they hâve complied with a gross load weight limitation than with an axle or wheel weight limitation. While the report of the National Conférence on State and Highway Safety, on which the court below relied, suggested a wheel weight limitation of 8,000 or 9,000 pounds, it also suggested that a gross weight limitation might be adopted and should be subject to the recommended wheel limitation. But the conférence declined to fix the amount of gross weight limitation, saying: “In view of the varying conditions of traffic, and lack of uniformity in highway construction in the several States, no uniform gross-weight limitations are here recommended for general adoption throughout the country.” The choice of a weight limitation based on convenience of application and conséquent lack of S. C. HWY. DEPT. v BARNWELL BROS. 193 177 Opinion of the Court. need for rigid supervisory enforcement is for the législature, and we cannot say that its preference for the one over the other is in any sense arbitrary or unreasonable. The choice is not to be condemned because the législature prefers a workable standard, less likely to be violated than another under which the violations will probably be increased but more easily detected. It is for the législature to say whether the one test or the other will in practical operation better protect the highways from the risk of excessive loads. If gross load weight is adopted as the test it is obvious that the permissible load must be somewhat lighter than if the axle or wheel weight test were applied. With the latter the gross weight of a loaded motor truck can never exceed twice the axle and four times the wheel limit. But the fact that the rear axle may and often does support as much as 70 or 80% of the gross load, with wheel weight in like proportion, requires that a gross load limit be fixed at considerably less than four times the permissible wheel limit. There was testimony before the court to support its conclusion that the highways in question are capable of sustaining without in jury a wheel load of 8,000 or 9,000 pounds, the différence depending upon the character of the tire in use, as against a wheel load of as much as 8,000 pounds, which would be possible under the statutory load limit of 20,000 pounds as applied to motor trucks, and approximates the axle limit in addition to the gross load limit recommended by the National Conférence on Street and Highway Safety. Much of this testimony appears to hâve been based on theoretical strength of concrète highways laid under idéal conditions, and none of it was based on an actual study of the highways of South Caro-lina or of the subgrade and other road building conditions which prevail there and which hâve a material bearing on the strength and durability of such highways. There is 53383°—38---------13 194 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. uncontradicted testimony that approximately 60% of the South Carolina standard paved highways in question were built without a longitudinal center joint which has since become standard practice, the portion of the concrète surface adjacent to the joint being strengthened by reinforcement or by increasing its thickness; and that owing to the distribution of the stresses on concrète roads when in use, those without a center joint hâve a tend-ency to develop irregular longitudinal cracks. As the concrète in the center of such roads is thinner than that at the edges, the resuit is that the highway is split into two irregular segments, each with a weak inner edge which, according to the expert testimony, is not capable of supporting indefinitely wheel loads in excess of 4,200 pounds. There is little in the record to mark any controlling distinction between the application of the gross load weight limitation to the motor truck and to the semi-trailer motor truck. There is testimony which is applicable to both types of vehicle, that in case of accident the danger from the momentum of a colliding vehicle increases with gross load weight. The record is without convincing evidence of the actual distribution, in practice, of the gross load weight over the wheels and axles of the permissible types of semi-trailer motor trucks, but this does not enable us to say that the législature was without substantial ground for concluding that the relative advan-tages of a gross load over a wheel weight limitation are substantially the same for the two types, or that it could not hâve concluded that they were so nearly alike for regulatory purposes as to justify the adoption of a single standard for both, as a matter of practical convenience. Even if the législature were to accept appellees’ assump-tion that net load weights are, in practice, evenly dis-tributed over the wheels supporting the load of a permissible semi-trailer so that with the statutory gross S. C. HWY. DEPT. v. BARNWELL BROS. 195 177 Opinion of the Court. load limit the load on the rear axle would be about 8,000 pounds it might, as we hâve seen, also conclude that the danger point would then hâve been reached in the case of some 1,200 miles of concrète state roads constructed without a center joint. These considérations, with the presumption of consti-tutionality, afford adéquate support for the weight limitation without reference to other items of the testimony tending to support it. Furthermore, South Carolina’s own expérience is not to be ignored. Before adoption of the limitation South Carolina had had expérience with higher weight limits. In 1924 it had adopted a combined gross weight limit of 20,000 pounds for vehicles of four wheels or less, and an axle weight limit of 15,000 pounds. In 1930 it had adopted a combined gross weight limit of 12^ tons with a five ton axle weight limit for vehicles having more than two axles. Act No. 721, 33 Stat. 1182; Act No. 685, 36 Stat. 1192, 1193. In 1931 it appointed a commission to investigate motor transportation in the state, to recommend législation, and to report in 1932. The présent weight limitation was recommended by the commission after a full considération of relevant data, including a report by the state engineer who had constructed the concrète highways of the state and who advised a somewhat lower limitation as necessary for their préservation. The fact thàt many States hâve adopted a different standard is not persuasive. The conditions under which highways must be built in the several States, their construction and the demands made upon them, are not uniform. The road building art, as the record shows, is far from having attained a scientific certainty and précision, and scientific précision is not the criterion for the exercise of the constitutional regulatory power of the States. Sproles v. Binford, supra, 388. The législature, being free to exercise its own judgment, is not bound by that of other législatures. It would hardly be contended 196 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. that if ail the States had adopted a single standard none, in the light of its own expérience and in the exercise of its judgment upon ail the complex éléments which enter into the problem, could change it. Only a word need be said as to the width limitation. While a large part of the highways in question are from 18 to 20 feet in width, approximately 100 miles are only 16 feet wide. On ail the use of a 96 inch truck leaves but a narrow margin for passing. On the road 16 feet wide it leaves none. The 90 inch limitation has been in force in South Carolina since 1920 and the concrète highways which it has built appear to be adapted to vehicles of that width. The record shows without contradiction that the use of heavy loaded trucks on the highways tends to force other traffic off the concrète surface onto the shoulders of the road adjoining its edges and to increase repair costs materially. It appears also that as the width of trucks is increased it obstructs the view of the highway, causing much inconvenience and increased hazard in its use. It plainly cannot be said that the width of trucks used on the highways in South Carolina is unrelated to their safety and cost of maintenance, or that a 90 inch width limitation adopted to safeguard the highways of the State, is not within the range of the permissible legislative choice. The regulatory measures taken by South Carolina are within its legislative power. They do not infringe the Fourteenth Amendment, and the resulting burden on Interstate commerce is not forbidden. Reversed. Mr. Justice Cardozo and Mr. Justice Reed took no part in the considération or decision of this case. MATY v. GRASSELLI CO. 197 Opinion of the Court. MATY, ADMINISTRATRIX, v. GRASSELLI CHEMICAL CO. CERTIORARI TO THE CIRCUIT COURT OF APPEALS FOR THE THIRD CIRCUIT. No. 378. Argued February 3, 1938.—Decided February 14, 1938. In an action for personal injuries, the plaintiff alleged his employment as a worker in a specified department of defendant’s plant and that while so employed he suffered the injuries through in-haling gases etc. attributable to defendant’s négligence. An amendment of the complaint broadened the description of the place of employment where the injuries were sustained so as to include another department located in another building of the same plant. Held that the amendment did not introduce a new cause of action within the meaning of the New Jersey statute of limitations. P. 199. 89 F. (2d) 456, reversed. Certiorari, 302 U. S. 663, to review the reversai of a judgment for the défendant, the présent respondent, in an action for personal injuries begun in a New Jersey state court and removed to the fédéral district court. Upon the death of the plaintiff, the présent petitioner was substituted, as administratrix, by the court below. Mr. Thomas F. Gain, with whom Messrs. Charles L. Guérin, Mario Turtur, and Francis Shunk Brown were on the brief, for petitioner. Mr. Louis Rudner, with whom Mr. Cari E. Geuther was on the brief, for respondent. Mr. Justice Black delivered the opinion of the Court. Petitioner (plaintiff) filed a complaint alleging that he was injured while employed in the silicate department of respondent’s (defendant’s) Chemical plant. Later, and more than two years after the date of his injuries, he amended his complaint. The only effect of the amend- 198 OCTOBER TERM, 1937. 'Opinion of the Court. 303 U. S. ment was to broaden the description of the place of em-ployment where the injuries were sustained so as to in-clude the phosphate department located in the same plant but in a different building 500 feet removed from the silicate department. The sole question is: Did the New Jersey statute of limitations of two years bar the amendment because it set out a new cause of action? The cause, originally brought in the New Jersey State Court, was removed, because of diversity of citizenship, to the District Court for New Jersey, where a verdict for plaintiff was set aside and judgment entered for de-fendant. The Court of Appeals affirmed, holding that the amendment to the complaint set out a new cause of action and was barred by the New Jersey statute of limitations.1 The pertinent part of the New Jersey statute of limitations reads:2 . ail actions hereafter accruing for injuries to per-sons caused by the wrongful act, neglect or default of any . . . corporation or corporations within this State, shall be commenced and instituted within two years next after the cause of such action shall hâve accrued and not after.” The original complaint alleged: “1. The plaintiff was in the employ of the défendant in the month of November, 1933, and for some time prior thereto at defendant’s plant in Grasselli, County of Union and State of New Jersey. “2. The plaintiff was employed by the défendant as furnace man, operator and general worker in the Silicate Department of defendant’s plant.” 189 F. (2d) 456. While the cause was pending in the Court of Appeals, the plaintiff died and his wife, the présent plaintiff, was substituted as Administratrix. Both are referred to as petitioner (plaintiff). 23 N. J. Comp. St. 1910, p. 3164, § 3; P. L. 1896, p. 119. MATY v. GRASSELLI CO. 199 197 Opinion of the Court. The complaint further alleged that plaintiff was in-jured while so employed by inhaling gases or injurions substances proximately caused by respondent’s failure to protect plaintiff from unnecessary dangers and to provide plaintiff a reasonably safe place in which to work. The amendment—added more than two years after the injuries were sustained—caused Paragraph 2 of the complaint to read as follows: “2. The plaintiff was employed by the défendant as furnace man, operator and general worker in the Silicate Department of defendant’s plant and was also employed in other Departments of the defendant’s plant where he performed his duties as he was directed to do during his employment in the Phosphate Department and Dorr department.” (New matter represented by italics.) This amendment did not change plaintiffs cause of action. The original action was brought for injuries sustained by inhaling harmful substances while the plaintiff was in the defendant’s employ previous to and including November 1933. The essentials of this cause of action were employment; in jury by or from harmful gases or substances while engaged in the employment; and proof that the injuries resulted from the négligent failure of défendant to protect plaintiff from unnecessary dangers and to provide plaintiff with a reasonably safe place in which to work. The responsibility of respondent was the same whether the harmful gases or substances were in-haled in the silicate department, the phosphate department, the Dorr department or any other department where plaintiff was performing his duties under his employment. It is not reasonably possible to say that peti-tioner’s right of recovery under the original complaint and under the amended complaint were two separate and distinct causes of action. Petitioner can hâve only one recovery for the one single injury alleged as a resuit of a breach of one continuing duty under one continuons employment. 200 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. The New Jersey Court of Errors and Appeals very clear-ly declared that State’s rule applying to the operation of its statute of limitations, in 1935, as follows: . amendments in causes where the statute of limitations has run, . . . ‘will not, as a rule, be held to state a new cause of action if the facts alleged show, substan-tially, the same wrong with respect to, the same transaction, or if it is the same matter more fully and differently laid, or if the gist of the action, or the subject of the con-troversy remains the same; and this is true although . . . the alleged incidents of the transaction, may be different. Technicdl rules will not be applied in determining whether the cause of action stated in the original and amended pleadings are identicdl, since, in the strict sense, almost any amendment may be said to change the original cause of action.’ ” 3 Under this rule laid down by the New Jersey Court, as to New Jersey’s statute of limitations, the amended complaint here substantially alleged the same wrong as the original complaint; relied upon the identical matter more fully and differently laid; and the essential éléments of the action and the controversy remained the same between the parties after as before the amendment. Pleadings are intended to serve as a means of arriving at fair and just settlements of controversies between liti-gants. They should not raise barriers which prevent the achievement of that end. The original complaint in this cause and the amended complaint were not based upon different causes of action. They referred to the same kind of employment, the same general place of employ- 3 Magliaro v. Modem Homes, Inc., 115 N. J. L. 151, 156-157; 178 A. 733, 736; O’Shaughnessy n. Bayonne News Co., 154 A. 13; 9 N. J. Mise. 345, 347; and see, New York Central & H. R. R. Co. n. Kinney, 260 U. S. 340; and United States v. Memphis Cotton OU Co., 288 U. S. 62. MOOKINI v. UNITED STATES. 201 197 Syllabus. ment, thé same injury and the same négligence. Proper pleading is important, but its importance consists in its effectiveness as a means to accomplish the end of a just judgment. The effect of the amendment here was to facili-tate a fair trial of the existing issues between plaintiff and défendant. The New Jersey statute of limitations did not bar the amended cause of action. The court be-low was in error. Since the judgment of the Court of Appeals was based only on a considération and improper application of the statute of limitations, the cause is re-versed and remanded to the Court of Appeals for further proceedings in harmony with these views. Reversed. Mr. Justice Cardozo took no part in the considération or decision of this case. MOOKINI et al. v. UNITED STATES. CERTIORARI TO THE CIRCUIT COURT OF APPEALS FOR THE NINTH CIRCUIT. No. 319. Argued February 2, 1938.—Decided February 28, 1938. 1. The Act of March 8, 1934, (28 U. S. C. 723a) empowering this Court to prescribe rules of practice with respect to proceedings after détermination of guilt in criminal cases in “District Courts of the United States, including the District Courts of Alaska, Hawaii, Puerto Rico, Canal Zone and Virgin Islands,” and in the other courts named, does not require that rules when prescribed shall be identical for ail the courts mentioned or that rules for ail shall be prescribed at the same time. P. 203. 2. In the rules heretofore promulgated by this Court (May 7, 1934, 292 U. S. 661) limited to proceedings in criminal cases in “District Courts of the United States” and in the Suprême Court of the District of Columbia and subséquent appellate proceedings, the term “District Courts of the United States” means constitutional courts created under Art. III of the Constitution; it does not embrace legislative courts such as the District Court for the Territory of Hawaii. P. 205. 202 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. 3. As the Criminal Appeals Rules were not made applicable to the District Court of the Territory of Hawaii, they did not change the time for appeals from that court to the Circuit Court of Appeals as allowed by the Act of February 13, 1925. '28 U. S. C. 225, 230. P. 205. 4. The provision in the organic Act of Hawaii (48 U. S. C. 645) that appeals from the District Court of that Territory to the Circuit Court of Appeals for the Ninth Circuit shall be had “in the same manner as appeals are allowed from district courts to circuit courts of appeal as provided by law,” does not require that the Criminal Appeals Rules prescribed by this Court for District Courts of the United States shall be held applicable to the District Court of Hawaii. P. 205. ’ 92 F. (2d) 126, reversed. Certiorari, 302 U. S. 674, to review a judgment dis-missing an appeal. Mr. O. P. Soares submitted on brief for petitioners. Mr. Bâtes Booth, with whom Soliciter General Reed, Assistant Solicitor General Bell, Assistant Attorney General McMahon, and Messrs. William W. Barron and W. Marvin Smith were on the brief, for the United States. Mr. Chief Justice Hughes delivered the opinion of the Court. Petitioners were convicted in the District Court of the Territory of Hawaii of violating § 35 of the Criminal Code relating to fraudulent claims. 18 U. S. C. 80. The verdict was rendered on May 28, 1935 ; motions for a new trial were overruled on June 19, 1935; and petitioners were sentenced on June 29, 1935. Appeal was allowed by the District Court on September 27, 1935. The Circuit Court of Appeals, finding that the appeal was not taken in the manner or within the time permitted by the Criminal Appeals Rules promulgated by this Court on May 7, 1934 (Rule III, 292 U. S. 662, 663), dis- MOOKINI v. UNITED STATES. 203 201 Opinion of the Court. missed the appeal. 92 F. (2d) 126. In view of the importance of the question as to the application of the Criminal Appeals Rules to the District Court of the Territory of Hawaii, we granted certiorari. It is not questioned that the appeal to the Circuit Court of Appeals was allowed within the three months’ period specified in § 8 (c) of the Act of February 13, 1925, c. 229, 43 Stat. 936, 940; 28 U. S. C. 225, 230; 48 U. S. C. 645. The Criminal Appeals Rules were promulgated pursu-ant to the Act of March 8, 1934, amending the Act of February 24, 1933. 28 U. S. C. 723a. The Act author-ized this Court— “to prescribe, from time to time, rules of practice and procedure with respect to any and ail proceedings after verdict, or finding of guilt by the court if a jury has been waived, or plea of guilty, in criminal cases in district courts of the United States, including the District Courts of Alaska, Hawaii, Puerto Rico, Canal Zone, and Virgin Islands, in the Suprême Courts of the District of Columbia, Hawaii, and Puerto Rico, in the United States Court for China, in the United States Circuit Courts of Appeals, in the Court of Appeals of the District of Columbia, and in the Suprême Court of the United States.” In order to aid the Court in exercising its authority under the statute, the Attorney General of the United States at the request of the Court submitted on May 26, 1933, a draft of proposed rules. These were expressly limited to proceedings in cases brought in the District Courts of the United States and in the Suprême Court of the District of Columbia. The reason for this limitation was thus stated by the Attorney General : “The Rules are limited in their application to proceedings in cases instituted in the District Courts of the United States and in the Suprême Court of the District of Columbia. There is not sufficient data at hand upon 204 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. which to predicate proposais at this time relative to practice and procédure in cases instituted in the District Courts of Alaska, Hawaii, Puerto Rico, Canal Zone, and Virgin Islands, or in the Suprême Courts of Hawaii and Puerto Rico, or in the United States Court for China. It is thought that it would be the part of wisdom to estab-lish the rules for practice and procedure for Continental United States before attempting to provide for the Terri-tories, Insular Possessions and Consular Courts, as these situations will undoubtedly require spécial treatment because of local conditions and the distance separating the trial court from the Appellate Court.” In considering and revising the draft thus submitted, we approved this suggestion. The rules were accordingly limited to proceedings— “in criminal cases in District Courts of the United States and in the Suprême Court of the District of Columbia, and in ail subséquent proceedings in such cases in the United States Circuit Courts of Appeals, in the Court of Appeals of the District of Columbia, and in the Suprême Court of the United States.” Order of May 7, 1934, 292 U. S. 661. No provision was made with respect to proceedings in cases brought in the District Courts of Alaska, Hawaii, Puerto Rico, Canal Zone and Virgin Islands, in the Suprême Courts of Hawaii and Puerto Rico, or in the United States Court for China. We entertain no doubt of our authority to limit the application of the new rules in this way. The statute empowered the Court to prescribe rules “from time to time” with respect “to any or ail proceedings,” after détermination of guilt, in criminal cases in the courts which were severally described. The statute con-tains no requirement that the Court must prescribe iden-tical rules with respect to ail the courts mentioned re-gardless of varying conditions, or that rules for ail these courts must be prescribed at one and the same time. On MOOKINI v. UNITED STATES. 205 201 Opinion of the Court. the contrary, the manifest intention of the Congress was to permit the Court to exercise its discrétion conceming the application of the rules. The term “District Courts of the United States,” as used in the rules, without an addition expressing a wider connotation, has its historié significance. It describes the constitutional courts created under Article III of the Constitution. Courts of the Territories are legislative courts, properly speaking, and are not District Courts of the United States. We hâve often held that vesting a territorial court with jurisdiction similar to that vested in the District Courts of the United States does not make it a “District Court of the United States.” Reynolds v. United States, 98 U. S. 145, 154; The City oj Panama, 101 U. S. 453, 460; In re Mills, 135 U. S. 263, 268; McAl-lister v. United States, 141 U. S. 174, 182, 183; Stephens v. Cherokee Nation, 174 U. S. 445, 476, 477; Summers N. United States, 231 U. S. 92, 101, 102; United States v. Burroughs, 289 U. S. 159, 163. Not only did the promul-gating order use the term District Courts of the United States in its historié and proper sense, but the omission of provision for the application of the rules to the territorial courts and other courts mentioned in the author-izing act clearly shows the limitation that was intended. As the Criminal Appeals Rules were not made applicable to the District Court of the Territory of Hawaii, they did not supersede or alter the provisions of the Act of February 13, 1925, as to appeals from that court to the Circuit Court of Appeals. 28 U. S. C. 225, 230. The provision of the Organic Act of Hawaii (48 U. S. C. 645) to which the court below refers, that appeals from the District Court of the Territory to the Circuit Court of Appeals should be taken in the same manner as appeals from district courts, was always subject to modification in the discrétion of the Congress which in its future législation could make or authorize such distinctions in ap- 206 OCTOBER TERM, 1937. Syllabus. 303 U. S. pellate procedure as appeared to be wise. The Act au-thorizing this Court to promulgate rules for criminal appeals, which should hâve the effect of législation neces-sarily modified the former statutory provisions so as to give the Court full authority to prescribe the time and manner of taking appeals and to leave the Court free to détermine to what courts, within the range of the author-ization, its rules should apply. Pursuant to this authority, the Court has limited its rules so that theÿ do not govern appeals from the District Court of the Territory of Hawaii and there is nothing in the earlier législation which compels the extension of the rules beyond their intended and expressed application. The judgment of the Circuit Court of Appeals is reversed and the cause is remanded to that court for further proceedings in conformity with this opinion. Reversed. Mr. Justice Cardozo took no part in the considération and decision of this case. SOUTHWESTERN BELL TELEPHONE CO. v. OKLAHOMA et al. APPEAL FROM THE SUPREME COURT OF OKLAHOMA. jNo. 560. Argued February 7, 1938.—Decided February 28, 1938. Upon appeal from the State Corporation Commission, the Suprême Court of Oklahoma affirmed an order fixing the rates of a téléphoné company, such afïirmance being, under the state constitution, a legislative act, and therefore not reviewable by appeal to this Court. The company then filed a pétition for rehearing asking for a judicial review, which pétition was denied without statement of reason. Upon appeal to this Court, the company contended that the déniai of the pétition was a judicial review, while the State’s Attorney General insisted that the whole pro-ceeding was legislative in character and that adéquate judicial S. W. BELL TEL. CO. v. OKLAHOMA. 207 206 Opinion of the Court. review could be obtained under the power of the state court to issue writs of mandamus and prohibition to the Commission. Held: 1. That, in the absence of a definite decision to that effect by the state court, this Court can not conclude that the state law provides no judicial review of such order. P. 212. 2. Assuming that the State affords a judicial remedy, there is no means of knowing whether the state court denied the pétition because an application for rehearing, after the legislative détermination, was not the proper way under the state practice to invoke the judicial power, or whether it entertained the application and by its ruling passed upon the controversy in a judicial capacity. Id. 3. This Court is therefore without jurisdiction to review the déniai of the pétition. Id. Appeal dismissed. Appeal from a judgment denying a pétition for rehear-ing in the nature of a judicial review after a decision, 181 Okla. 246, affirming an order of the Corporation Commission of the State fixing rates for téléphoné service. Mr. Mac Q. Williamson, Attorney General of Okla-homa, with whom Messrs. J. B. A. Robertson and S. J. Gordon were on the brief, for appellees. Mr Erwin W. Clausen, with whom Messrs. J. R. Spielman, C. M. Bracelen and John H. Cantrell were on the brief, for appellant. Per Curiam. Motion to dismiss, for the want of jurisdiction, an appeal from a détermination of the Suprême Court of Okla-homa, made September 14, 1937, denying a “pétition for rehearing in the nature of judicial review” after a decision affirming an order of the Corporation Commission of the State fixing rates for téléphoné service. The motion is upon the ground that the proceeding in the state court was legislative and was not a suit within the mean- 208 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. ing of § 237 of the Judicial Code (28 U. S. C. 344) gov-erning our appellate jurisdiction. The constitution of Oklahoma authorizes the Corporation Commission to prescribe rates “for transportation and transmission companies.” Art. IX, § 18. Appellant, operating téléphoné lines, is a “transmission company.” Art. IX, § 34. Appeals from the Commission, may be taken only to the Suprême Court of the State. Art. IX, §20. No court of the State, other than the Suprême Court by way of appeal, has jurisdiction “to review, reverse, correct, or annul” any action of the Commission within the scope of its authority, save that writs of mandamus and prohibition will lie from the Suprême Court to the Commission “in ail cases where such writs, respectively, would lie to any inferior court or officer.” Id. In case of appeal, no new or additional evidence may be introduced in the Suprême Court, but the Suprême Court has jurisdiction to consider and détermine “the reasonableness and justness of the action of the Commission appealed from, as well as any other matter arising under such appeal.” The action of the Commission is to be regarded “as prima Jade just, reasonable, and correct,” but the court may, when it deems necessary in the interests of justice, remand to the Commission aïiy case pending on appeal “and require the same to be further investigated by the Commission, and reported upon to the court (together with a certificate of such additional evidence as may be tendered before the Commission by any party in interest), before the appeal is finally decided.” Art. IX. § 22. Section 23 of Article IX provides: “Whenever the court, upon appeal, shall reverse an order of the Commission afïecting the rates, charges, or the classifications of traffic of any transportation or transmission company, it shall, at the same time, substitute therefor such orders as, in its opinion, the Commission S. W. BELL TEL. CO. v. OKLAHOMA. 209 206 Opinion of the Court. should hâve made at the time of entering the order ap-pealed from; otherwise the reversai order shall not be valid. Such substituted order shall hâve the same force and effect (and none other) as if it had been entered by the Commission at the time the original order appealed from was entered.” In the instant case, the Corporation Commission on March 18, 1935, after hearing, made its order fixing appellant’s rates (Okla. Corp. Com. Rep., 1935, p. 558), and on appeal the Suprême Court of the State, on July 13, 1937, affirmed the order. 181 Okla. 246; 71 P. 2d 747. Appellant concédés that this decision was legislative in character, in view of the authority conferred by the above-quoted provision of § 23 of Article IX and its construction by the state court. See Pioneer Téléphoné & Telegraph Co. N. State, 40 Okla. 417, 425, 426; 138 Pac. 1033; Swain v. Oklahoma Railway Co., 168 Okla. 133, 134-136; 32 P. 2d. 51; Oklahoma Cotton Ginners’ Assn. v. State, 174 Okla. 243, 248, 251; 51 P. 2d 327. Compare Prentis v. Atlantic Coast Line Co., 211 U. S. 210, 226, 227; Oklahoma Natural Gas Co. v. Russell, 261 U. S. 290, 291. But appellant contends that the Suprême Court of the State “completed its legislative review and function by the filing of its opinion of July 13, 1937,” and that appellant was then free to invoke the jurisdiction of the court to exercise its judicial power and function by an application for “a judicial review.” This, appellant States, was the purpose of its pétition for rehearing. In support of that pétition, appellant urged upon the Suprême Court of the State the considération of the provisions of the state constitution with respect to the vest-ing of judicial power and the appellate jurisdiction of the court (Art. VII, §§ 1 and 2); of the bill of rights guar-anteeing a judicial remedy for every injury (Art. II, § 6) ; of § 22 of Article IX providing that, on appeals to the 53383°—38-----14 210 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. Suprême Court from the Corporation Commission, that court should hâve jurisdiction to détermine “the reason-ableness and justness” of the action of the Commission “as well as any other matter” arising on the appeal; and of § 34 of Article IX that the provisions of that Article should “always be so restricted in their application as not to conflict with any of the provisions of the Constitution of the United States, and as if the necessary limitations upon their interprétation had been herein expressed in each case.” In concluding the submission of its pétition for rehearing appellant insisted that the Suprême Court of the State “not only has the power, right, jurisdiction and authority, now to review this case judicially, which right, power, jurisdiction and authority it has not heretofore possessed, but that it is the duty of this court to do so at this stage of the proceeding, in order that appellant may hâve the legislative order or enact-ment fixing its rates for future application at Tulsa re-viewed by an appropriate fédéral court with the least possible delay and cost, if such should later be found necessary, resulting from an adverse decision by this [the state] court.” The ruling of the state court was expressed in the fol-lowing journal entry: “Now on this 14th day of September 1937, the Court having considered appellant’s Pétition for Rehearing in the Nature of Judicial Review, doth overrule and deny same, to which appellant is allowed exception.” At appellant’s request, the state court granted super-sedeas and stayed its mandate pending appellant’s application for the allowance of an appeal to this Court and the détermination of the appeal if taken. An appeal was then allowed by the Chief Justice of the state court and the case is thus brought here. The Attorney General of the State, moving to dismiss the appeal, insists that appellant’s contention that the S. W. BELL TEL. CO. v. OKLAHOMA. 211 206 Opinion of the Court. action of the state court in denying the pétition for re-hearing “was a judicial review, is wholly erroneous” ; that the appeal is “from a purely legislative considération of the questions involved.” The substance of the Attorney General’s argument is shown in the following statement: “This Pétition for Rehearing . . . was not sufîicient to confer, upon the Suprême Court of Oklahoma, jurisdiction and power to treat the record then before it as a new cause involving a judicial review, and no record was before said court warranting said court to treat same as a judicial appeal, nor was the said record, nor its contents, treated as such by appellant, nor the court, and no judicial issues were raised in said legislative review. It is not the rule to permit the character of controversies to be completely changed, either in form or substance, after the opinion of a court has been handed down, and this is especially true when the same is sought to be accom-plished, for the first time by a so-called pétition for re-hearing in which the only subject mentioned was the request for a judicial review for the first time in the his-tory of the case.” The Attorney General, however, does not concédé that the State of Oklahoma “does not furnish an adéquate judicial review of questions such as are involved in this proposed appeal.” On the contrary, “the State asserts that appellant has, and has had, an adéquate method of relief.” When pressed upon the argument at bar to state what judicial remedy was open to appellant under the state constitution, the Attorney General referred to the power conferred upon the Suprême Court by the proviso in § 20 of Article IX to issue writs of mandamus and prohibition to the Commission. No decision of the state court as to the questions which would be open upon an application for such a writ has been brought to our attention. Appellant States that the question now presented is one of first impression; that the action of the state court 212 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. in this case “constitutes the first construing of this [the présent] procedure which that court has ever made. There are no spécifie precedents.” The novelty of the procedure, and the lack of exposition in the brief ruling, leave us in doubt as to the true import of the déniai of the pétition for rehearing. In view of the serious questions which would be raised if it were determined that the State provides no means of obtaining a judicial review of an order of the Commission fixing rates, alleged to be confiscatory, in the case of a transportation or transmission company, we should not reach such a conclusion in the absence of a definite decision by the state court to that effect. Neither party before us advances a contention that there is such a lack of judicial remedy. Appellant says that judicial review is available through the procedure appellant has chosen and that the déniai of its pétition for rehearing was judicial action. The Attorney General asserts the contrary, contending that judicial remedy exists but must be sought in another manner. But— assuming that the State affords a judicial remedy— whether the state court has denied appellant’s pétition because an application for rehearing after what is con-ceded by both parties to be a legislative détermination was not the proper way under the state practice to in-voke the judicial power, or has entertained the application and by its ruling has passed upon the controversy in a judicial capacity, we hâve no means of knowing. We hâve repeatedly held that it is essential to the juris-diction of this Court in reviewing a decision of a court of a State that it must appear affîrmatively from the record, not only that a fédéral question was presented for decision to the highest court of the State having jurisdiction but that its decision of the fédéral question was necessary to the détermination of the cause; that the fédéral question was actually decided or that the CENTURY INDEMNITY CO. v. NELSON. 213 206 Counsel for Parties. judgment as rendered could not hâve been given without deciding it. De Saussure v. Gaillard, 127 U. S. 216, 234; Johnson n. Risk, 137 U. S. 300, 306, 307; Wood Mowing & Reaping Machine Co. v. Skinner, 139 U. S. 293, 295, 297; Whitney v. California, 274 U. S. 357, 360, 361; Lynch v. New York, 293 U. S. 52, 54. Applying this rule, the motion to dismiss must be granted. Dismissed. Mr. Justice Cardozo took no part in the considération and decision of this case. CENTURY INDEMNITY CO. v. NELSON. CERTIORARI TO THE CIRCUIT COURT OF APPEALS FOR THE NINTH CIRCUIT. No. 362. Argued February 2, 1938.—Decided February 28, 1938. After the submission of a law case tried without a jury, the District Court ordered “that judgment be entered for plaintiff . . . upon findings of facts and conclusions of law to be presented.” There-after, in accordance with a rule of the court, spécial findings of fact and conclusions of law were proposed by each side; those offered by the-plaintiff were adopted by the judge and formai judgment was ordered and entered. Held that the first order was preliminary; that rejections of defendant’s proposed findings were rulings made “in the progress of the trial,” within the meaning of 28 U. S. C. § 875, and reviewable by the Circuit Court of Appeals. P. 215. 90 F. (2d) 644, reversed. Certiorari, 302 U. S. 674, to review the afïirmance of a judgment of the District Court in an action at law tried without a jury. Mr. Jewel Alexander, with whom Mr. Oliver Dibble was on the brief, for petitioner. Mr. Joe G. Sweet submitted on brief for respondent. 214 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. Mr. Justice McReynolds delivered the opinion of the Court. This cause went up by appeal from the District Court, Northern District, California. Of the twenty-eight as-signments of error, eleven, based upon the trial court’s refusai of certain requested spécial findings, were rejected by the Circuit Court of Appeals. It held the requests “were made too late,” that “the findings were proposed after the trial had been completed and after the court had announced its decision and hence did not occur during the trial.” To support this view it cited Continental National Bank v. National City Bank, (9th Cir.) 69 F. (2d) 312, 317, which affirms—“It is settled that they [requests for findings] came too late if made after judgment even though the trial judge, after judgment, granted leave to make the request.” A jury having been duly waived, the trial judge heard evidence. At the conclusion of this counsel for both sides made motions for judgment and findings. The minutes of May 31, 1934, show—“This case having been heretofore heard and submitted and due considération having been had, it is ordered that judgment be entered for plaintiff, with interest and costs, upon findings of facts and conclusions of law to be presented.” The bill of exceptions recites—“Thereafter, [after requests for judgment and findings] the case was orally ar-gued before the court and was submitted upon written briefs. Thereafter and on June 1, 1934, [May 31 ?] and outside the presence of the parties, the Court made and entered its order granting judgment to the plaintiff with findings to be submitted. Thereafter proposed findings of fact and conclusions of law were served and lodged with the Court by plaintiff, and within the time allowed by law the défendant served and lodged its proposed spécial findings of fact and conclusions of law in lieu of those proposed by the plaintiff. CENTURY INDEMNITY CO. v. NELSON. 215 213 Opinion of the Court. “Thereafter and on June 16, 1934, the Court, without the presence of the parties, signed the proposed spécial findings of fact and conclusions of law of the plaintiff and filed same on said date as the findings and conclusions of the Court, and judgment was entered on said June 16, 1934.” June 16, 1934, “Spécial Findings and Conclusions of Law” presented for plaintiff Nelson were signed by the District Court and were filed. The document concluded thus— “From the foregoing Findings of Fact the court con-cludes that judgment should be entered in favor of the plaintiff and against the défendant in the sum of Six Thousand ($6000.00) Dollars together with interest thereon at the legal rate of seven per cent (7%) per an-num from the date of the commencement of this action, to-wit: September 24, 1931, together with plaintiff’s costs of suit incurred herein, and that upon satisfaction of said Judgment the Clerk of this court should deliver to the défendant the assignment by plaintiff against the San Francisco Iron & Métal Company, a corporation in bank-ruptcy. “Let judgment be entered accordingly.” Sec. 875, Title 28, U. S. C. A., is in the margin;1 also Rule 42, District Court Northern District of California.2 1 Section 875, Title 28, U. S. C. A. Review in cases tried without jury. When an issue of fact in any civil cause in a district court is tried and determined by the court without the intervention of a jury, according to section 773 of this title, the rulings of the court in the progress of the trial of the cause, if excepted to at the time, and duly presented by a bill of exceptions, may be reviewed upon a writ of error or upon appeal; and when the finding is spécial the review may extend to the détermination of the sufficiency of the facts found to support the judgment. 2 Rule 42, United States District Court, Northern District of California. Findings ... In actions at law, where a request for spécial findings of fact is made and granted, and in suits in equity, no judgment 216 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. We are unable to accept the conclusion below that within the intent of the statute the “progress of the trial” ended on June 1, when the court ordered “that judgment be entered for plaintiff, with interest and costs, upon findings of fact and conclusions of law to be presented,” and thereafter it was too late adequately to présent spécial findings of fact. The qualifying words in the order “upon findings of fact and conclusions of law to be presented” are appropriate to suggest “merely a pre-hminary order” and réservation of opportunity for further action. Considering them along with Rule 42 and the subséquent action by counsel for both sides and the court—ail without suggestion of objection—it ap-pears plain enough that ail parties understood the cause was “in progress of trial” until entry of the final judgment on June 16. Rule 42 is susceptible of the interprétation insisted upon by counsel for petitioner and ap- shall be entered until the findings and, in an equity suit, the conclusions of law, shall hâve been signed and filed or waived as herein-after provided; but the rendition of the decision or opinion shall be deemed and considered, and shall be entered by the Clerk, as merely a preliminary order for judgment. Within five days after written notice of the decision, the prevailing party shall préparé a draft of the findings and, in an equity suit, of the conclusions of law, and deliver the same to the Clerk for the Judge and serve a copy thereof upon the adverse party, who may, within five days thereafter, deliver to the Clerk and serve upon the adverse party such pro-posed amendments or additions as he may desire. If the prevailing party fails to présent such draft as above provided, the adverse party may préparé a draft thereof and deliver the same to the Clerk for the Judge and serve a copy thereof on the prevailing party within five days thereafter. The findings of fact and, where required, the conclusions of law, shall thereafter be settled by the Judge, and when so settled shall be engrossed within five days thereafter, and shall be then signed and filed. A failure to comply with the requirements of this rule may be deemed to be a waiver of findings by the party so failing. CENTURY INDEMNITY CO. v. NELSON. 217 213 Opinion of the Court. parently they proceeded in good faith according to that view. In so doing, we think they were right. See Clement v. Phoenix Ins. Co., Fed. Cases 2,882. Continental National Bank v. National City Bank does not discuss Rule 42 and went upon facts which seem materially different from those presented by this record. Refusai to consider the eleven assignments of error arose from what we regard as wrongful interprétation and application of § 875 and Rule 42. Their évident purpose is to insure orderly and timely présentation to the judge of matters deemed important in advance of any definite action by him in respect of them. They should not be so narrowly construed as to defeat their real purpose. It is not necessary in the circumstances to treat the first order for judgment (June 1) as ending “the progress of the trial.” Ail counsel and the presiding judge seem, rightly we think, to hâve entertained a wholly different view and to hâve acted accordingly. The challenged judgment must be reversed. The cause will be remanded to the Circuit Court of Appeals for further proceedings in conformity with this opinion. Reversed. Mr. Justice Cardozo took no part in the considération or decision of this case. 218 OCTOBER TERM, 1937. Syllabus. 303 U. S. HELVERING, COMMISSIONER OF INTERNAL REVENUE, v. THERRELL.* CERTIORARI TO THE CIRCUIT COURT OF APPEALS FOR THE FIFTH CIRCUIT. No. 128. Argued December 17, 1937.—Decided February 28, 1938. The compensation received (1) by a liquidator appointed by the State Comptroller to wind up insolvent banks pursuant to Florida statutes; (2) by legal counsel employed by the Insurance Department of New York for services in liquidating insolvent Insurance companies taken over by the state Superintendent of Insurance, pursuant to New York statutes; (3) by an attorney in the Department of Justice of Pennsylvania assigned by the Attorney General for legal work relating to winding up of insolvent banks taken over by the state Secretary of Banking pursuant to Pennsylvania statutes. Held (p. 222) subject to income taxation by the Fédéral Government, it appearing: 1. That the compensation in each instance was paid from the assets of the liquidating corporation, not from funds belonging to the State; 2. That no one of the taxpayers was an officer of the State in the strict sense of that term; 3. That the businesses about which they were employed were not utilized by the States in the discharge of their essential gov-emmental duties; 4. That the corporations were private enterprises, and their funds private property. 88 F. (2d) 869, and Id. 873, reversed. 89 id. 699, affirmed. 92 id. 150, reversed. *Together with No. 129, Helvering, Commissioner of Internai Revenue, v. Tunnicliffe, on certiorari to the Circuit Court of Appeals for the Fifth Circuit; No. 287, McLoughlin v. Commissioner of Internai Revenue, on certiorari to the Circuit Court of Appeals for the Second Circuit; and No. 597, Helvering, Commissioner of Internai Revenue, v. Freedman, on certiorari to the Circuit Court of Appeals for the Third Circuit. HELVERING v. THERRELL. 219 218 Opinion of the Court. Certiorari to review decisions of Circuit Courts of Appeals in four cases on appeals from decisions of the Board of Tax Appeals sustaining income tax assessments. In Nos. 128, 129 and 597 (34 B. T. A. 956) the Board’s ruling was reversed by the lower court; in No. 287, the Board’s ruling, 34 B. T. A. 963, was affirmed. Solicitor General Reed, with whom Assistant Attorney General Morris, and Messrs. Sewall Key, Berryman Green, and Warner W. Gardner were on the briefs, for the Commissioner. Mr. Harry M. Voorhis for respondent in Nos. 128 and 129. Mr. H. M. Hampton was on the brief with Mr. Voorhis in No. 129. Mr. Bernhard Knollenberg, with whom Messrs. Jesse Hoyt and Alfred C. Bennett were on the brief, for respondent in No. 287. Mr. John W. Townsend for respondent in No. 597. By leave of Court, briefs of amici curiae were filed by Messrs. John J. Bennett, Jr., Attorney General, Henry Epstein, Solicitor General, John F. X. McGohey, Colin McLennan, and John C. Crary, Assistant Attorneys General, of New York, on behalf of that State, in support of petitioner in No. 287; and by Mr. Herbert Pope, on behalf of Charles C. Stilwell, in support of the respondent in No. 597. Mr. Justice McReynolds delivered the opinion of the Court. Has the Fédéral Government power to tax compensation paid to attorneys and others out of corporate assets for necessary services rendered about the liquidation of 220 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. an insolvent corporation by a state officer proceeding as required by her statutes? The opinions below state the essential facts—not in dispute; make adéquate references to the relevant statu-tory provisions; and cite numerous authorities. No. 128. Under Florida statutes when a bank becomes insolvent “The State Comptroller may appoint a liquidator [sub-ject to dismissal] to take charge of the assets and affairs of such bank . . . [who,] under the direction and supervision of the Comptroller, shall take possession of the books and records and assets of every description . . . and in his name shall sue for and collect ail debts and claims belonging to it, and upon the order of the court of competent jurisdiction may sell or compound ail bad or doubtful debts and on like order may sell ail real and Personal property . . . and sue for and enforce the indi-vidual liability of the stockholders.” He shall “pay ail money received by him to the State Treasurer to be held as a spécial deposit . . . shall make quarterly reports, or when called upon, to the Comptroller.” The appoint-ment must follow notice and be confirmed by the Circuit Court. Liquidation expenses are payable out of the cor-porate funds held by the Treasurer. “The compensation of the liquidator shall be fixed by the Comptroller and shall be based upon the amount of work actually and necessarily performed, and shall in no case exceed five per cent of the cash collected.” Respondent Therrell, liquidator for several banks, de-voted substantially ail his time to the work. He held no commission from the Governor, took no oath of office but was formally appointed by the Comptroller and gave bond. His compensation, for 1931 and 1932, paid from corporate assets, was assessed by the Commissioner for fédéral income taxes. The Board of Tax Appeals ap-proved; but the Circuit Court of Appeals found immun- 218 HELVERING v. THERRELL. Opinion of the Court. 221 ity under the Fédéral Constitution. Therrell v. Commissioner of Internai Revenue, 88 F. (2d) 869. No. 129. Respondent Tunnicliffe, liquidator of insolvent banks appointed by the Comptroller of Florida, was assessed for fédéral income taxes upon the sums received for services during 1931 and 1932. The Board of Tax Appeals approved; the Circuit Court of Appeals ruled otherwise upon its opinion in No. 128. Tunnicliffe v. Commissioner of Internai Revenue, 88 F. (2d) 873. Both causes présent the same points. No. 287. Petitioner McLoughlin was employed by the Insurance Department of New York as legal counsel in the Liquidation Bureau and received for services during 1932, $5,125.00. This bureau is in charge of a Deputy Super-intendent of Insurance a civil service employé whose salary is paid by the State. It employs many persons— superintendents, attorneys, bookkeepers, stenographers, adjusters, accountants, etc. Under the statutes the Superintendent may apply to the court for an order to take over the assets of an insolvent Insurance company and liquidate its affairs. When this issues the corporate charter is dissolved and the Superintendent must proceed to collect assets, adjust claims, etc. He determined petitioner’s compensation and caused it to be paid from assets of the several companies in liquidation according to the time devoted to each. The Commissioner assessed this compensation for fédéral income tax; the Board of Tax Appeals approved. The Circuit Court of Appeals affirmed, and definitely held it was not exempted by the Fédéral Constitution. McLoughlin v. Commissioner of Internai Revenue, 89 F. (2d) 699. No. 597. Freedman, employed as an attorney in Pennsylvania’s Department of Justice, received annual salary of 222 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. $3,000.00. The Attorney General has power to appoint attorneys to represent any department, board or commission of the State and fix their compensation. The Secre-tary of Banking has broad powers over banks. When one becomes unsound he may, after notice and hearing and with the Attorney General’s consent, take possession and wind up its affairs. Ail necessary expenses, including compensation of attorneys, spécial deputies, assistants and others employed about the proceedings, are paid from funds of the corporation. During 1932 the respondent was assigned for legal work relating to closed banks and was paid by the Secretary of Banking out of their funds. The Commissioner assessed the sum so received for fédéral income tax. The Board of Tax Appeals approved; the Circuit Court of Appeals declared the salary exempt. Freedman v. Commissioner of Internai Revenue, 92 F. (2d) 150. What limitations does the Fédéral Constitution impose upon the United States in respect of taxing instrumental-ities and agencies employed by a State and, conversely, how far does it inhibit the States from taxing instru-mentalities and agencies utilized by the United States, are questions often considered here. McCulloch v. Maryland (1819), 4 Wheat. 316; Weston v. Charleston (1829), 2 Pet. 449; Dobbins v. Commissioners of Erie County, 16 Pet. 435; Lane County N. Oregon, 7 Wall. 71; Veazie Bank v. Fenno, 8 Wall. 533, 556; South Carolina v. United States, 199 U. S. 437, 457; Metcalf & Eddy v. Mitchell, 269 U. S. 514; Indian Motocycle Co. v. United States, 283 U. S. 570; Burnet v. Jergins Trust, 288 U. S. 508, 516; Ohio v. Helvering, 292 U. S. 360, 368; Hélvering v. Powers, 293 U. S. 214; Rogers v. Graves, 299 U. S. 401; Brush v. Commissioner, 300 U. S. 352. HELVERING v. THERRELL. 223 218 Opinion of the Court. The Constitution contemplâtes a national government free to use its delegated powers; also state governments capable of exercising their essential reserved powers; both operate within the same territorial limits; conse-quently the Constitution itself, either by word or necessary inference, makes adéquate provision for preventing conflict between them. Among the inferences which dérivé necessarily from the Constitution are these: No State may tax appro-priate means which the United States may employ for exercising their delegated powers; the United States may not tax instrumentalities which a State may employ in the discharge of her essential governmental duties—that is those duties which the framers intended each member of the Union would assume in order adequately to func-tion under the form of government guaranteed by the Constitution. By définition precisely to delimit “delegated powers” or “essential governmental duties” is not possible. Con-troversies involving these terms must be decided as they arise, upon considération of ail the relevant circum-stances. Notwithstanding discordant views which hâve sometimes arisen because of varying emphasis given to one or another of such circumstances, it is now settled doctrine that the inferred exemption from fédéral taxation does not extend to every instrumentality which a State may see fit to employ. Exemption dépends upon the nature of the undertaking; it is cabined by the rea-son which underlies the inference. Veazie Bank v. Fenno, supra, sustained a tax laid by the Fédéral Government upon notes issued by state banks, notwithstaïiding the view entertained by two Justices that it amounted to “taxation of the powers and faculties of the state governments, which are essential to their sovereignty, and to the efficient and independ- 224 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. ent management and administration of their internai affairs.” South Carolina v. United States, supra, gave occasion for much considération of the Fédéral Government’s power to tax instrumentalities utilized by a State. It ruled, against a stout dissent, that although South Carolina had the right to control the sale of liquors through the dispensary System, nevertheless Congress could tax the dispensers who acted as agents of the State in mak-ing sales. “Looking, therefore, at the Constitution in the light of the conditions surrounding at the time of its adoption, it is obvious that the framers in grantiug full power over license taxes to the National Government meant that that power should be complété, and never thought that the States by extending their functions could practically destroy it.” Burnet v. Jergins Trust, supra, upheld a fédéral tax upon the receipts by the lessee of oil lands which belonged to the City of Long Beach, California. “The subject of the tax is so remote from any governmental function as to render the effect of the exaction inconsiderable as respects the activities of the city.” In Ohio v. Helvering, supra, we held that the agencies and operations of the State of Ohio in the conduct of its Department of Liquor Control were subject to excise taxes prescribed by Congress. “Whenever a State engages in a business of a private nature it exercises non-go vernmental functions and the business, though con-ducted by the State, is not immune from the exercise of the power of taxation which the Constitution vests in the Congress.” Helvering v. Powers, supra, ruled that the compensation of members of the Board of Trustées of the Boston Elevated Railway Company was subject to the fédéral income tax notwithstanding they were appointed by the 218 HELVERING v. THERRELL. Opinion of the Court. 225 Governor of the State, confirmée! by the Council, and endowed with large powers to regulate and fix fares, etc. “The fact that the State has power to undertake such enterprises, and that they are undertaken for what the State conceives to be the public benefit, does not estab-lish immunity.” The cases last referred to strikingly illustrate the out-come of efforts here to apply the recognized doctrine in respect of taxing State agencies. According to them and others of like nature due weight, we are unable to con-clude that the Commissioner erred in making any one of the assèssments involved in the four cases presently be-fore us. He gave proper application to the rule which we must recognize as established. The compensation of the taxpayers was paid from corporate assets—not from funds belonging to the State. No one of them was an officer of the State in the strict sense of that term. The business about which they were employed was not one utilized by the State in the discharge of her essential gov-ernmental duties. The corporations in liquidation were private enterprises; their funds were the property of pri-vate individuals. It follows that the judgments in Nos. 128, 129 and 597 must be reversed; the judgment in No. 287 must be affirmed. Nos. 128, 129, and 597, reversed. No. 287 affirmed. Mr. Justice Cardozo and Mr. Justice Reed took no part in the considération or decision of this case. 53383°—38---------15 226 OCTOBER TERM, 1937. Statement of the Case. 303 U. S. UNITED STATES et al. v. GRIFFIN et al., RE-CEIVERS. APPEAL FROM THE DISTRICT COURT OF THE UNITED STATES FOR THE SOUTHERN DISTRICT OF GEORGIA. No. 63. Argued November 19, 1937. Reargued January 3, 1938.— Decided February 28, 1938. 1. Lack of jurisdiction of the District Court over the subject-matter can not be waived by the parties; when discovered on appeal, dismissal of the bill must be ordered. P. 229. 2. The jurisdiction to set aside orders of the Interstate Commerce Commission, conferred upon the District Court of three judges by the Urgent Deficiencies Act of October 22, 1913, does not apply to négative orders. P. 232. 3. An order of the Interstate Commerce Commission declining, upon re-examination, to increase the compensation for carrying mail fixed by an earlier order pursuant to the Railway Mail Pay Act, is a négative order. P. 234. 4. Orders of the Interstate Commerce Commission fixing the compensation payable by the Government to railroads for carrying the mails, even if affirmative orders, are not subject to the extraor-dinary remedy of the Urgent Deficiencies Act, since they are not within the reasons for it, namely, to guard against ill-considered action by a single judge and to avert delays ordinarily incident to litigation, in cases of wide public interest. P. 234. Déniai of jurisdiction under the Urgent Deficiencies Act, leaves open other ways to judicial review of orders respecting railway mail pay. P. 238. 5. A suit under the Urgent Deficiencies Act to set aside an order conceming mail pay is not primarily against the Commission, but is a suit against the United States. The United States can not be sued without authority specifically conferred. The Railway Mail Pay Act does not confer that authority. P. 238. Reversed. Appeal from a decree of the District Court of three judges, which set aside an order of the Interstate Commerce Commission refusing an increase of railway mail pay over what had previously been allowed, and which UNITED STATES v. GRIFFIN. 227 226 Opinion of the Court. directed the Commission to take “such further action in the premises as the law requires in view of the annulment and setting aside of” its order. Mr. Edward M. Reidy, with whom Solicitor General Reed, Assistant Attorney General Jackson, and Messrs. Elmer B. Collins and Daniel W. Knowlton were on the briefs, for appellants on the reargument and on the original argument. Mr. Moultrie Hitt, with whom Messrs. G. Kibby Mun-son and Gregory Hankin were on the briefs, for appellees on the reargument and on the original argument. Mr. Justice Brandeis delivered the opinion of the court. The sole question requiring decision is one of statutory construction: The Railway Mail Pay Act of July 28, 1916, c. 261, § 5, 39 Stat. 412, 425, 429, 430, provides that the Interstate Commerce Commission “shall establish by order a fair, reasonable rate or compensation to be re-ceived” by railroads for carrying the mail;1 and author-izes the Commission to modify the order upon a “re-ex-amination.” The Urgent Deficiencies Act of October 22, 1913, c. 32, 38 Stat. 208, 219, 220 (amending Act of June 18, 1910, c. 309, 36 Stat. 539) déclarés that district courts shall hâve jurisdiction “of cases brought to enjoin, set 1 “The Postmaster General is authorized and directed to adjust the compensation to be paid to railroad companies for the transportation and handling of the mails and fumishing facilities and services in connection therewith upon the conditions and the rates hereinafter provided.” 39 U. S. C. § 524. “AU railway common carriers are hereby required to transport such mail matter as may be offered for transportation by the United States in the manner, under the conditions, and with the service prescribed by the Postmaster General and shaU be entitled to receive fair and reasonable compensation for such transportation and for the service connected therewith.” 39 U. S. C. § 541. 228 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. aside, annul or suspend in whole or in part any order of the Interstate Commerce Commission.” May suit be brought under the Urgent Deficiencies Act to set aside an order refusing, upon “re-examination,” to increase the allow-ance for railway mail compensation theretofore made to this carrier? The suit was brought, under the Urgent Deficiencies Act, in the fédéral court for Southern Georgia, by the receivers of the Georgia & Florida Railroad against the United States and the Interstate Commerce Commission, to set aside an order made May 10, 1933, under the Railway Mail Pay Act, Railway Mail Pay, Georgia & Florida R. Co., 192 I. C. C. 779; and to grant a permanent in-junction. By that order the Commission had denied upon a “re-examination” an application further to increase the compensation allowed by the order of July 10, 1928. Railway Mail Pay, 144 I. C. C. 675. The 1928 order had, upon a “re-examination,” increased the compensation originally fixed by order of December 23, 1919. Railway Mail Pay, 56 I. C. C. 1. As grounds for setting aside the order of May 10, 1933, the receivers alleged, among other things, that the order was unlawful, because the finding that the existing rates were fair and rea-sonable was without evidence to support it and contrary to the evidence and that the order will violate the Fifth Amendment by taking property without just compensation. The jurisdiction of the court was not challenged; and the case was heard by three judges on the merits. A decree was rendered setting aside as Unlawful the order of May 10, 1933, and directing the Commission to take further action. Additional hearings were then had by the Commission; and on February 4, 1936, it again de-clined to order any increase over that which had been allowed July 10, 1928. Railway Mail Pay, Georgia & Florida R. Co., 214 I. C. C. 66. The last order of the 226 UNITED STATES v. GRIFFIN. Opinion of the Court. 229 Commission was assailed by a supplémentai bill on the same grounds as that assailed in the original bill. The jurisdiction of the court was not challenged; the case was again heard on the merits by three judges; and a de-cree was entered setting aside the order of February 4, 1936, and directing the Commission to take “such further action in the premises as the law requires in view of the annulment and setting aside of” the order. From that decree the United States and the Interstate Commerce Commission hâve appealed to this Court. Here, although answering to the merits, they challenged the jurisdiction of the District Court. Since lack of jurisdiction of a fédéral court touching the subject matter of the litigation cannot be waived by the parties, we must upon this appeal examine the contention; and, if we conclude that the District Court lacked jurisdiction of the cause, direct that the bill be dismissed. United States v. Corrick, 298 U. S. 435, 440. We at first thought that the District Court had jurisdiction, and ordered a reargument of the case on the merits. But, upon further considération of the jurisdictional question, we are of opinion that the remedy provided by the Urgent De-ficiencies Act is not applicable to this order. First. The Railway Mail Pay Act terminated the System theretofore prevailing of service under voluntary contracts.2 As embodied in United States Code, Title 39, 2 Prior to the Act of 1916, the carnage of mail by railroads—with the exception of some aided by land grant—was held to be not com-pulsory “at adéquate compensation to be judicially determined,” Atchison, T. & S. F. Ry. v. United States, 225 U. S. 640, 650, but under contracts voluntarily entered into with the Postmaster General. New York, N. H. & H. R. Co. v. United States, 251 U. S. 123, 127. For the législation prior to 1916 conceming compensation of railroads for carrying the mail, see Railway Mail Pay, 56 I. C. C. 1, 3-7. For the several proposais prior to 1916 to modify the laws goveming such transportation, see Report of Postmaster General to Congress August 12, 1911, H. R. Doc. 105, 62d Congress, lst Session; Senate 230 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. §§ 523 to 568, it provides in forty-six sections comprehen-sively for the character, means and methods of mail transportation; defines the authority of the Postmaster General; and describes the obligations of the railroads and their right to compensation, which is to be fixed by the Commission. “The Interstate Commerce Commission is hereby em-powered and directed to fix and déterminé from time to time the fair and reasonable rates and compensation for the transportation of such mail matter by railway com-mon carriers and the services connected therewith, pre-scribing the method or methods by weight, or space, or both, or otherwise, for ascertaining such rate or compensation, and to publish the same, and orders so made and published shall continue in force until changed by the commission after due notice and hearing.” 39 U. S. C. § 542. “For the purpose of determining and fixing rates or compensation hereunder the commission is authorized to make such classification of carriers as may be just and reasonable and, where just and équitable, fix general rates applicable to ail carriers in the same classification.” 39 U. S. C. § 549. “At the conclusion of the hearing the commission shall establish by order a fair, reasonable rate or compensation to be received, at such stated times as may be named in the order, for the transportation of mail matter and the service connected therewith, and during the continuance of the order the Postmaster General shall pay the carrier Bill 7371, House Bill 23721, 62d Congress, 2d Session; Railway Mail Pay, Report of Joint Çommittee on Compensation for the Transportation of the Mail, August 31, 1914, H. R. Doc. 1155, 63d Congress, 2d Session; Senate Bill 6405, House Bill 17042, 63d Congress, 2d Session; Senate Bill 4175, House Bill 10242, 64th Congress, lst Session. UNITED STATES v. GRIFFIN. 231 226 Opinion of the Court. from the appropriation for inland transportation by rail-road routes such rate or compensation.” 39 U. S. C. §551. Eleven sections of the act deal with the procedure on hearings before the Commission.3 No provision is made for a judicial review. But provision is made for administrative review by “reëxamination” of an order. “Either the Postmaster General or any such carrier may at any time after the lapse of six months from the entry of the order assailed apply for a reëxamination and thereupon substantially similar proceedings shall be had with respect to the rate or rates for service covered by said application, provided said carrier or carriers hâve an interest therein.” 39 U. S. C. § 553. There hâve been many administrative reviews by “reexamination.” 4 The case at bar appears to be the only 3 Section 544 provides: “The procedure for the ascertainment of the rates and compensation shall be as provided in sections 545 to 554 of this title”; and § 554 provides: “For the purposes of Sections 524 to 568 of this title the Interstate Commerce Commission is hereby vested with ail the powers which it is authorized by law to exercise in the investigation and ascertainment of the justness and reasonableness of freight, passenger, and express rates to be paid by private shippers.” 4 The first order fixing compensation for transportation of mail was made by the Commission December 23, 1919. Railway Mail Pay, 56 I. C. C. 1. By it rates were fixed on the general System of fiat rates on a space basis, with higher rates for certain short lines less than 100 miles in length. Since then the Commission has made orders on applications for re-examination under 39 U. S. C. § 553, in many cases. Railway Mail Pay, New England Lines, 85 I. C. C. 157, on reargument, 95 I. C. C. 204, 104 I. C. C. 521; Railway Mail Pay, Certain Intermountain and Pacific Coast Short-Line Railroads, 95 I. C. C. 493, on reargument, 104 I. C. C. 521; Railway Mail Pay, Woodstock Ry. Co. et al., 96 I. C. C. 43, on reargument, 104 I. C. C, 521; Railway Mail Pay, Canadian Nat. Ry. et al., 109 I. C. C. 13; Railway. Mail Pay, Alabama, Tenn. & No. Ry., 112 I. C. C. 151; Railway Mail Pay, Certain Intermountain and Pacific Coast Short 232 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. instance in which an attempt has been made to set aside a mail order by suit under the Urgent Deficiencies Act. Second. The Urgent Deficiencies Act provides a method of judicial review of orders of the Interstate Commerce Commission possessing the following extraordinary fea-tures: (1) The original hearing in the district court is not before a single judge, but before three, of whom one must be a circuit judge; (2) From the decree of the district court as so constituted a direct appeal to the Suprême Court is granted as of right, instead of a review by a circuit court of appeals; (3) Upon both the trial court and the Suprême Court rests the obligation to give the case precedence over others. These features were first introduced by the Expediting Act of 1903, 32 Stat. 823, for suits by the United States to enforce the antitrust and commerce laws. They were extended by the Hep-burn Act of 1906, § 5, 34 Stat. 584, 590, 592, to suits to enforce or to set aside orders of the Interstate Commerce Commission. When that jurisdiction was vested in the Commerce Court provisions with like effect were pro- Line Railroads, 120 I. C. C. 439, on reconsideration, 151 I. C. C. 734; Railway Mail Pay, Winston-Salem Southbound Ry., 123 I. C. C. 33; Railway Mail Pay, 144 I. C. C. 675; Railway Mail Pay, 151 I. C. C. 734; Railway Mail Pay, Georgia & Florida R., 192 I. C. C. 779, on rehearing, 214 I. C. C. 66. A number of other decisions relating to railway mail pay hâve also been made. Railway Mail Pay, Certain Short Lines, 165 I. C. C. 774; Railway Mail Pay, Jacksonville & H. R. et al., 174 I. C. C. 781; Railway Mail Pay, Illinois Terminal Co., 174 I. C. C. 796; Railway Mail Pay, Maçon, D. & S. R. et al., 185 I. C. C. 715; Railway Mail Pay, N. J. & N. Y. R., 198 I. C. C. 504; Railway Mail Pay, Piedmont & No. Ry., 216 I. C. C. 467. Similar orders hâve been entered under the Electric Railway Mail Pay Act, 40 Stat. 742, 748. Electric Railway Mail Pay, 58 I. C. C. 455; Electric Railway Mail Pay, 98 I. C. C. 737. Compare Transmission of Mail by Pneumatic Tubes in the City of New York, 85 I. C. C. 207. UNITED STATES v. GRIFFIN. 233 226 Opinion of the Court. vided for cases coming before it. 36 Stat. 539. To its jurisdiction the district court succeeded, with these features, under the Urgent Deficiencies Act. In the opinion of Congress jurisdiction with the extraor-dinary features of the Urgent Deficiencies Act was justi-fied by the character of the cases to which it applied— cases of public importance because of the widespread effect of the decisions thereof. In such cases Congress sought to guard against ill-considered action by a single judge and to avert the delays ordinarily incident to litigation. In construing the Act, this Court concluded that despite the broad language used in the Commerce Court Act, Congress could not hâve intended to include in this spécial jurisdiction suits to set aside every kind of order issued by the Commission. For substantially every decision, and every other kind of action by the Commission is expressed in, or is followed by, an order; and many of the orders are obviously not of such public importance and widespread effect as to justify, in cases affecting them, the extraor-dinary features of the Urgent Deficiencies Act. The Commerce Court had (36 Stat. 539) jurisdiction “over ail cases of the following kinds”: “First. Ail cases for the enforcement, otherwise than by adjudication and collection of a forfeiture or penalty or by infliction of criminal punishment, of any order of the Interstate Commerce Commission other than for the pay-ment of money. “Second. Cases brought to enjoin, set aside, annul, or suspend in whole or in part any order of the Interstate Commerce Commission. . . .” This Court concluded that, as the intent of Congress was “to relieve parties in whole or in part from the duty of obedience to orders which are found to be illégal,” there was jurisdiction to set aside only those kinds of orders which there was jurisdiction to enforce ; that a distinction must be drawn between “affirmative” and “négative” 234 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. orders; and that jurisdiction under the Commerce Court Act was applicable only to “affirmative” orders. Procter & Gamble Co. v. United States, 225 U. S. 282; Hooker v. Knapp, 225 U. S. 302. Since the abolition of the Commerce Court, that rule has been consistently followed in cases brought under the Urgent Deficiencies Act. Le-high Valley R. Co. v. United States, 243 U. S. 412; Pied-mont & Northern Ry. Co. v. United States, 280 U. S. 469; Standard OU Co. v. United States, 283 U. S. 235; United States v. Corrick, 298 U. S, 435. Compare Delaware) & Hudson Co. v. United States, 266 U. S. 438; United States v. Los Angeles & Sait Lake R. Co., 273 U. S. 299. The order of February 4, 1936, here assailed, does not command either the Government or the Railroad to do anything. It is simply a refusai, upon a second “re-ex-amination” of the order of July 11, 1928, further to in-crease the compensation thereby awarded upon a “re-ex-amination” of the compensation originally awarded by the order made December 23, 1919. The order assailed, being a refusai to change the existing status, was a “négative” order. The District Court lacked jurisdiction to set it aside, and should hâve dismissed the bill. Third. Congress cannot be assumed to hâve made the extraordinary remedy of the Urgent Deficiencies Act applicable for the détermination of the validity of railway mail pay orders, even if “affirmative.” The issue here is whether the existing mail revenue of $35,728 should be increased for the year by $31,227. There is no wide public interest in its speedy détermination. There is no danger of temporarily interrupting the mail service through the improvident issue of an injunction by a single judge. Only the method or amount of payments cur-rently to be made would be affected. Such orders are in character unlike those under the Boiler Inspection Act, 36 Stat. 913, as amended, 38 Stat. 1192, 43 Stat. 659, and the Inland Waterways Corporation Act, 43 Stat. 360, 361, UNITED STATES v. GRIFFIN. 235 226 Opinion of the Court. as amended, 45 Stat. 978, 48 Stat. 968, of which jurisdiction was taken although the statutes contained no provision for judicial review.5 In Great Northern Ry. Co. v. United States, 277 U. S. 172, we held that there was not jurisdiction under the Urgent Deficiencies Act of a suit to set aside an order of the Interstate Commerce Commission made under Title II of the Transportation Act of 1920 determining the amount due a railroad on the Government’s guaranty of income for the period following relinquishment of fédéral control. And in United States v. Los Angeles & Sait Lake R. Co., 273 U. S. 299, we held that there was not jurisdiction under the Urgent Deficiencies Act of a suit to set aside a final order under the Valuation Act, even though that statute was enacted as an amendment to the Interstate Commerce Act itself. 37 Stat. 701, as amended, 41 Stat. 456, 474, 493, 42 Stat. 624? In recent years the field of administrative détermination has been widely extended; and the duty of making many of these déterminations has been imposed upon the Interstate Commerce Commission.7 Some of the statutes contain spécifie provision making applicable ju- 5 Baltimore & Ohio R. Co. v. United States, 293 U. S. 454; United States v. Illinois Central R. Co., 291 U. S. 457; compare Mississippi Valley Barge Line Co. v. United States, 292 U. S. 282. 6 Compare United States v. Illinois Central R. Co., 244 U. S. 82; Délaware & Hudson Co. v. United States, 266 U. S. 438; United States v. Atlanta, B. & C. R. Co., 282 U. S. 522. 7Among the statutes delegating to the Commission administrative duties in addition to those which it performs under the Interstate Commerce Act are: Postal Service: Railway Mail Pay Act, 39 Stat. 412, 425, 430; Electric Railway Mail Pay Act, 40 Stat. 742, 748; New York City Pneumatic Tube Mail Pay Act, 42 Stat. 652, 661; Fourth Class Mail Régulations Act, 43 Stat. 1053, 1067, as amended, 45 Stat. 940, 942; Air Mail Act, 48 Stat. 933, 935, as amended, 48 Stat. 1243, 49 Stat. 614. Railroad Operation: Safety Appliance Act, 27 Stat. 531, as amended, 32 Stat. 943, 36 Stat. 298; Boiler Inspection Act, 36 Stat. 913, 914, as amended, 38 Stat. 1192, 43 Stat. 659; 236 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. risdiction under the Urgent Deficiencies Act. This is true of the Emergency Railroad Transportation Act of 1933, 48 Stat. 211, 216, as amended, 49 Stat. 376, and of the Motor Carrier Act of 1935, 49 Stat. 543, 550. Compare Transportation of Explosives Act (Criminal Code, § 233), 35 Stat. 554, 555, as amended, 35 Stat. 1088, 1135, 41 Stat. 1445. It is true likewise of several stat-utes under which the déterminations are to be made by other administrative tribunals. Shipping Act of 1916, 39 Stat. 728, 738, superseded by 49 Stat. 1985 (United States Shipping Board); Packers & Stockyards Act of 1921, 42 Stat. 159, 168 (Secretary of Agriculture) ; Per-ishable Agricultural Commodities Act of 1930, 46 Stat. 531, 535 (Secretary of Agriculture); Emergency Railroad Transportation Act of 1933, supra (Fédéral Coôr-dinator of Transportation) ; Communications Act of 1934, 48 Stat. 1064, 1093, as amended, 50 Stat. 189 (Fédéral Locomotive Ash Pan Act, 35 Stat. 476; Accident Investigation Act, 36 Stat. 350, 351; Hours of Service Act, 34 Stat. 1415; Railway Labor Act, 44 Stat. 577, as amended, 48 Stat. 1185, 49 Stat. 1189; Transportation Act of 1920, Title II, 41 Stat. 456, 457, as amended, 44 Stat. 1450; Emergency Railroad Transportation Act of 1933, 48 Stat. 211, 216, as amended, 49 Stat. 376. Railroad Finance: Clayton Antitrust Act, 38 Stat. 730, 734, as amended, 43 Stat. 939, 48 Stat. 1102; Reconstruction Finance Corporation Act, 47 Stat. 711, as amended, 48 Stat. 20, 99, 120, 1109, 49 Stat. 1, 796, 50 Stat. 5, 357; Bankruptcy Act, § 77, 47 Stat. 1474, as amended, 49 Stat. 911, 1969. Miscellaneous : Transportation of Explosives Act (Criminal Code, § 233), 35 Stat. 554, 555, as amended, 35 Stat. 1088, 1135, 41 Stat. 1445; Standard Time Zone Act, 40 Stat. 450; St. Louis Bridge Act, 43 Stat. 7, 8; Inland Waterways Corporation Act, 43 Stat. 360, as amended, 45 Stat. 978, 48 Stat. 968, 49 Stat. 958; Radio Act of 1927, 44 Stat. 1162, 1173, superseded by 48 Stat. 1064; Motor Carrier Act of 1935, 49 Stat. 543, 550. Although enacted as Part II of the Interstate Commerce Act, the Motor Carrier Act of 1935 is included in this list because it seems more properly classified as a complété and independent statute than as merely an amendment to the Act of 1887. 226 UNITED STATES v. GRIFFIN. Opinion of the Court. 237 Communications Commission).8 The orders for which review is provided by each of these statutes are like the orders under the Interstate Commerce Act fixing rates payable by shippers. Improper injunctive relief of such orders or delay in final détermination of their validity may seriously affect the public interest by preventing or obstructing action under those statutes. While the compensation fixed in a railway mail pay order is ordinarily measured by a rate, the ultimate question determined by the Commission is, as in the Great Northern case, the proper compensation to be paid by the Government to the railroad for services and the use of its property—the quantum meruit for carrying the mail. There is nothing in the history of the Railway Mail Pay Act which requires that the Urgent Deficiencies Act be made applicable to the détermination of the validity of such orders.9 8 Compare Merchant Marine Act of 1936, 49 Stat. 1985, 1987 (United States Maritime Commission). A similar procedure has also been provided for certain suits to enjoin the enf or cernent or operation of state and fédéral statutes on the ground that they are uncon-stitutional. Judicial Code, § 266, 36 Stat. 557, 1162, as amended, 37 Stat. 1013, 43 Stat. 938; Judiciary Act of 1937, 50 Stat. 751, 752. 9 The provision calling for the Interstate Commerce Commission to fix the rates at which the mail is to be carried was introduced in the Senate as an amendment to the bill by Senator Cummins of lowa. In answer to questions as to “whether the amendment provides for an appeal in this case as in other rate-making cases before the Interstate Commerce Commission,” he stated: “I think it would permit the same review. . . . There would be the same remedy precisely under my amendment for the railway companies that now exists in the case of the establishment of a rate for a private shipper. . . . It is provided for in just the same way the présent law does.” 53 Cong. Rec., 9694-95. No further reference to judicial review occurs in the debates on this provision in either House; and no reference to judicial review was made in the report of the Committee of either House, nor in that of the Conférence Committee whose recommendations were adopted. See Sen. Rep. 459, H. R. Rep. 91, H. R. Rep. 981, 64th Cong., lst Sess. 238 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. Fourth. The absence in the Railway Mail Pay Act of a provision for judicial review and the déniai of jurisdiction under the Urgent Deficiencies Act do not preclude every character of judicial review. If the Commission makes the appropriate finding of reasonable compensation but fails, because of an alleged error of law, to order payment of the full amount which the railroad believes is payable under the finding, the Court of Claims has jurisdiction of an action for the balance, as the claim asserted is one founded upon a law of Congress. Missouri Pacific R. Co. v. United States, 271 U. S. 603. Compare United States v. New York Central R. Co., 279 U. S. 73, affirming 65 Ct. Cl. 115, 121.10 And since railway mail service is compulsory, the Court of Claims would, under the general provisions of the Tucker Act, hâve jurisdiction also of an action for additional compensation if an order is confiscatory. United States v. Great Falls Mfg. Co., 112 U. S. 645; North American Transportation & Trading Co. N. United States, 253 U. S. 330, 333; Jacobs v. United States, 290 U. S. 13, 16. More-over, as district courts hâve jurisdiction of every suit at law or in equity “arising under the postal laws,” 28 U. S. C., § 41 (6), suit would lie under their general jurisdiction if the Commission is alleged to hâve acted in excess of its authority, or otherwise illegally. Compare Powell v. United States, 300 U. S. 276, 288, 289. But a suit under the Urgent Deficiencies Act to set aside an order concerning mail pay is not primarily one against the Commission. Primarily, it is a suit against the 10 Other decisions of the Court of Claims under the Railway Mail Pay Act of 1916 are: Chicago & E. I. Ry. v. United States, 63 Ct. Cl. 585; Nevada County N. G. R. Co. v. United States, 65 Ct. Cl. 327; Chicago & E. I. Ry. Co. n. United States, 72 Ct. Cl. 407; Maçon, D. & S. R. Co. v. United States, 78 Ct. Cl. 251; 79 Ct. Cl. 298. Compare Pere Marquette Ry. Co. v. United States, 59 Ct. Cl. 538; New Jersey & N. Y. R. Co. v. United States, 80 Ct. Cl. 243 226 U. S. v. ILLINOIS CENT. R. CO. Syllabus. 239 United States.11 And the United States can be sued only when authority so to do has been specifically con-ferred. The Railway Mail Pay Act does not confer that authority. Decree reversed—with direction to the District Court to dismiss the bill without costs to either party. Reversed. Mr. Justice Black agréés with the resuit and fully with ail of the opinion except paragraph Fourth. Mr. Justice Cardozo and Mr. Justice Reed took no part in the considération or decision of this case. UNITED STATES v. ILLINOIS CENTRAL RAILROAD CO. CERTIORARI TO THE CIRCUIT COURT OF APPEALS FOR THE FIFTH CIRCUIT. No. 352. Argued January 14, 17, 1938.—Decided February 28, 1938. Cattle in a railway car were brought to the place where they were to be unloaded for water, feed and rest, as required by the Act of June 29, 1906, arriving there before the period allowed by the Act for their continuons confinement in the car had expired, but unloading was delayed beyond that period owing to the fact that the carrier’s yardmaster, aware of the situation, negligently failed to notify another employée of the carrier whose duty it was to unload them. Held that the carrier “knowingly and will-fully” failed to comply with the statute and was subject to the penalty thereby prescribed. P. 242. In statutes denouncing offenses involving turpitude, “willfully” is generally used to mean with evil purpose, criminal intent or the like; but in those denouncing acts not in themselves wrong 11 Compare Judicial Code § 211, 36 Stat. 542, 1150, as amended, 38 Stat. 219, 28 U. S. C. § 48; Lambert Run Coal Co. v. Baltimore & Ohio R. Co., 258 U. S. 377, 382. 240 . OCTOBER TERM, 1937. Opinion, of the Court. 303 U. S. it often dénotés conduct which is intentional, or knowing, or volun-tary, as distinguished from accidentai, or conduct marked by care-less disregard of its rightfulness. 90 F. (2d) 213, reversed. Certiorari, 302 U. S. 671, to review the affirmance of a judgment for the Railroad Company in an action by the United States to recover a penalty. Mr. Gordon Dean argued the cause, and Solicitor General Reed, Assistant Attorney General McMahon, and Mr. W. Marvin Smith were on the brief, for the United States. Mr. Selim B. Lemle, with whom Messrs. Arthur A. Moreno, E. C. Craig, Charles N. Burch, H. D. Minor, and Clinton H. McKay were on the brief, for respond-ent. Mr. Justice Butler delivered the opinion of the Court. Petitioner brought this suit in the fédéral court for eastem Louisiana to recover from respondent a penalty for violation of the Act of June 29, 1906, 34 Stat. 607, 45 U. S. C. §§ 71-74. Upon an agreed statement, the court found the facts, stated its conclusions of law and gave judgment for respondent. The circuit court of appeals affirmed. 90 F. (2d) 213. This Court granted a writ of certiorari. 302 U. S. 671. The question for decision is whether, as a matter of law, the facts found show conclusively that respondent knowingly and willfully failed to comply with the re-quirements of the first section of the Act. It déclarés that no carrier whose road forms a part of a line over which cattle shall be conveyed from one State to another shall confine the same in cars for longer than 28 consecutive hours without unloading them into prop-erly equipped pens for rest, water and feeding unless pre- 239 U. S. v. ILLINOIS CENT. R. CO. Opinion of the Court. 241 vented by storm or by other accidentai and unavoidable causes which cannot be anticipated or avoided by the exercise of due diligence and foresight; upon the written request of the owner the time of confinement may be ex-tended to 36 hours., Section 2 requires that animais so unloaded shall be properly fed and watered. Section 3 provides: “Any railroad . .. who knowingly and willfully fails to comply with the provisions of the two preced-ing sections shall for every such failure be liable for and forfeit and pay a penalty of not less than $100 nor more than $500 .. recoverable by civil action in the name of the United States. § 4. The pétition alleged that respondent knowingly and willfully confined cattle in a car for 37 hours without unloading them. The answer admitted that the cattle were continuously confined in the car from three o’clock in the afternoon of October 8, 1932, when loaded at point of shipment, Hermanville, Mississippi, until four o’clock of the morning of October 10 when unloaded at destination, New Orléans, Louisiana, but directly put in issue the allégation that respondent knowingly and willfully so confined the cattle. It alleged that the car arrived at New Orléans at 11: 35 in the evening of October 9; that having received advance information of the approxi-mate time of arrivai and of the time when the 36-hour period would expire, respondent’s yardmaster, in order promptly to handle the shipment, procured an extra en-gine and crew immediately upon arrivai of the car to take it to the stockyards and, before the expiration of the permissible time of confinement, there place it for unloading; that the yardmaster negligently failed to notify the employée, whose duty it was to unload; and because of his oversight and négligence the cattle were continuously confined in the car for 37 hours. A motion by petitioner for judgment on the pleadings having been overruled, the parties waived trial by jury and stipulated evidentiary facts in substance as alleged 53383°—38------16 242 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. in the answer. They left open the question whether respondent knowingly and willfully confined the cattle for more than 36 hours. The case was submitted for decision on the agreed statement without more. The court found evidentiary facts in accordance with the stipulation, held failure to unload within the time was due to the négligence of the yardmaster, and concluded that respondent did not knowingly and willfully fail to com-ply with the statute. The case dépends upon the meaning of the phrase “knowingly and willfully,” used in § 3 to characterize the transgressions for which penalties are imposed. The Act is to be construed to give effect to its humanitarian provisions, and as well to the exceptions in favor of the carriers. Chicago & N. W. Ry. Co. v. United States, 246 U. S. 512, 517-518. The penalty is not imposed for un-witting failure to comply with the statute. United States v. Sioux City Stock Yards Co., 162 Fed. 556, 562. United States N. Stockyards Terminal Ry. Co., 178 Fed. 19, 23. St. Joseph Stockyards Co. v. United States, 187 Fed. 104; Oregon-Washington R. & Nav. Co. v. United States, 205 Fed. 341, 343. But in this case, the respondent knew when the permissible period of confinement would expire, brought the car to destination, and, within the time allowed, placed it for unloading. By allowing the 36 hours to expire, it “knowingly” failed to comply with the statute. Mere omission with knowledge of the facts is not enough. The penalty may not be recovered unless the carrier is also shown “willfully” to hâve failed. In stat-utes denouncing offenses involving turpitude, “willfully” is generally used to mean with evil purpose, criminal in-tent or the like. But in those denouncing acts not in themselves wrong, the word is often used without any such implication. Our opinion in United States v. Mur-dock, 290 U. S. 389, 394, shows that it often dénotés that 239 U. S. v. ILLINOIS CENT. R. CO. Opinion of the Court. 243 which is “intentional, or knowing, or voluntary, as dis-tinguished from accidentai,” and that it is employed to characterize “conduct marked by careless disregard whether or not one has the right so to act.” The signifi-cance of the word “willfully” as used in § 3 now before us, was carefully considered by the circuit court of appeals for the eighth circuit in St. Louis & S. F. R. Co. v. United States, 169 Fed. 69. Speaking through Circuit Judge Van Devanter, now Mr. Justice Van Devanter, the court said (p. 71) : “ 'Willfully’ means something not expressed by ‘knowingly,’ else both would not be used conjunctively. . . . But it does not mean with intent to injure the cattle or to inflict loss upon their owner because such intent on the part of a carrier is hardly within the pale of actual expérience or reasonable supposition. . . . So, giving effect to these considérations, we are persuaded that it means purposely or obstinately and is designed to describe the attitude of a carrier, who, having a free will or choice, either intentionally disregards the statute or is plainly indifferent to its requirements.” That statement has been found a useful guide to the meaning of the word “willfully” and to its right application in suits for penalties under § 3. United States v. Stockyards Terminal Ry. Co., supra, 23. St. Joseph Stockyards Co. v. United States, supra, 105. Oregon-Washington R. & Nav. Co. v. United States, 205 Fed. 337, 339. St. Louis Merchants’ Bridge T. Ry. Co. v. United States, 209 Fed. 600. See also Chicago, B. & Q. R. Co. v. United States, 194 Fed. 342, 346. United States v. Kansas City Southern Ry. Co., 202 Fed. 828, 833. Considered as unaffected by the yardmaster’s négligence, respondent’s failure to take the cattle from the car already placed at the yard for unloading, unquestion-ably discloses disregard of the statute and indifférence to its requirements and compels the conclusion that, within the meaning of § 3, respondent willfully violated its duty 244 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. to unload as required by § 1. It is immaterial whether the yardmaster’s négligence or oversight was intentional or excusable. As between the government and respondent, the latter’s breach is precisely the same in kind and degree as it would hâve been if its yardmaster’s failure had been intentional instead of merely négligent. The duty violated did not arise out of the relation of employer and employée but was one that, in virtue of the statute, was owed by respondent to the shippers and the public. As respondent could act only through employées, it is responsible for their failure. To hold carriers not liable for penalties where the violations of §§ 1 and 2 are due to mere indifférence, inadvertence or négligence of employées would defeat the purpose of § 3. Whether respondent knowingly and willfully failed is to be determined by the acts and omissions which characterize its violation of the statute and not upon any breach of duty owed to it by its employées. Respondent’s contention that it is not liable because its failure was due to the négligence or oversight of the yardmaster cannot be sus-tained. Montana Cent. Ry. Co. v. United States, 164 Fed. 400, 403. United States v. Atlantic Coast Line R. Co., 173 Fed. 764, 769. Cf. Oregon-Washington R. & Nav. Co. v. United States, 205 Fed. 337, 340. Reversed. Mr. Justice Cardozo and Mr. Justice Reed took no part in the considération or decision of this case. McCOLLUM v. HAMILTON NAT. BANK. 245 Opinion of the Court. McCOLLUM, TRUSTEE IN BANKRUPTCY, v. HAMILTON NATIONAL BANK. CERTIORARI TO THE SUPREME COURT OF TENNESSEE. No. 342. Argued January 31, 1938.—Decided February 28, 1938. Rev. Stats. § 5197 govems the rates of interest chargeable by national banks, and § 5198 provides that, if a greater rate has been paid, the person paying it, or his legal représentative, may recover twice the amount from the bank. Where the person en-titled became bankrupt and the action against the bank was by his trustée in bankruptcy, the state court first granted judgment for double the usurious interest, but set off the judgment against the bankrupt’s indebtedness to the bank. Héld: 1. Although the form of action prescribed is debt, the cause of action is ex delicto and the recovery punitive; no set-off is pennissible in the proceeding, either before or after judgment. P. 247. 2. Punishment for usury does not dépend upon payment of the borrower’s debt. P. 249. Reversed. Certiorari, 302 U. S. 670, to review the affirmance of a decree granting recovery to a trustée in bankruptcy in a suit against the bank under Rev. Stats. § 5198, but setting off the judgment against the bankrupt’s debts to the bank. Messrs. Joseph W. Thompson and Joseph B. Roberts for petitioner. Mr. C. W. K. Meacham, with whom Mr. J. B. Sizer was on the brief, for respondent. Mr. Justice Butler delivered the opinion of the Court. Section 5197, Revised Statutes,1 governs the rates of interest to be taken by national banking associations and 112 U. S. C., § 85. 246 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. § 51982 déclares that the receiving of a rate of interest greater than that allowed, when knowingly done, shall be deemed a forfeiture of the entire interest and provides that, in case a greater rate has been paid, the per-son paying it may recover back twice the amount, in a suit in the nature of an action of debt. Petitioner is trustée in bankruptcy of Lookout Planing Mills, a corporation. He brought this suit under § 5198 in the chancery court of Hamilton County, Tennessee, to recover from respondent the penalty imposed by that section. Respondent answered denying liability, and by cross-bill alleged the bankrupt owed it $25,493.70 on notes, and prayed that it be allowed to set off its claim against any judgment that petitioner might obtain. Petitioner’s answer to the cross-bill asserted that recov-ery of the penalty did not dépend on payment of the debt. The chancelier found that the bankrupt paid and respondent knowingly received $5,235.55 as interest based on a rate in excess of that permitted and gave him judgment for double that amount. He ruled that after judgment petitioner’s claim was subject to set-off and ordered that the amount awarded him be applied as a crédit upon the debt. The state suprême court held the set-off permissible under the Bankruptcy Act, § 68 (a), and expressly authorized by § 8769 of the Tennessee Code and 212 U. S. C., § 86: "The taking, receiving, reserving, or charging a rate of interest greater than is allowed by the preceding section, when knowingly done, shall be deemed a forfeiture of the entire interest which the note, bill, or other evidence of debt carries with it, or which has been agreed to be paid thereon. In case the greater rate of interest has been paid, the person by whom it has been paid, or his legal représentatives, may recover back, in an action in the nature of an action of debt, twice the amount of the interèst thus paid from the association taking or receiving the same: Provided, That such action is commenced within two years from the time the usurious transaction occurred.” McCOLLUM v. HAMILTON NAT. BANK. 247 245 Opinion of the Court. declared that petitioner would be required to do equity by having his claim credited on the larger one owing to the respondent by the bankrupt. The question is whether respondent is entitled to hâve the amount of the judgment for penalty credited on its claim against the bankrupt estate. When the bank knowingly received illégal interest, it immediately became liable for, and the borrower became entitled to recover from it, a penalty of twice the amount of the interest thus paid. Farmers’ & Mechanics’ National Bank v. Dearing, 91 U. S. 29. Lake Benton First National Bank N. Watt, 184 U. S. 151. Upon petitioner’s appointment as trustée in bankruptcy, the bankrupt’s right to recover the penalty vested in him. Bankruptcy Act, § 70 (a), 11 U. S. C. § 110 (a). First National Bank v. Lasater, 196 U. S. 115, 118. Reed N. American-Ger-man Nat. Bank, 155 Fed. 233. The penalty is to be en-forced according to the terms of the statute. Guilt be-ing established, the law itself fixes the punishment at pre-cisely twice the usurious exaction paid; it may not be enhanced or mitigated because of aggravating circum-stances or équitable considérations. As the sum de-manded is certain, recovery in an action of debt is au-thorized, though the claim arises not in contract but in tort. Chaffee & Co. v. United States, 18 Wall. 516, 538. The liability can only be enforced in an action “brought specially and éxclusively for that purpose,—where the sole issue is the guilt or innocence of the accused, without the presence of any extraneoùs facts which might confuse the case.” Barnet v. National Bank, 98 U. S. 555, 559. One paying a national bank usurious interest and entitled to enforce the penalty may not recover it by way of set-off in a suit brought upon his note to the bank. Haseltine v. Central Bank, 183 U. S. 132, 137. Barnet v. National Bank, supra. Dreisbach n. National Bank, 104 U. S. 52. Stephens v. Monongahela Bank, 111 U. S. 197. 248 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. See Schuyler National Bank v. Gadsden, 191 U. S. 451, 456. Reasons, at least as cogent as those that uphold that rule, support the contention that the state court erred in permitting respondent to crédit the amount of peti-tioner’s judgment for penalty upon the notes given it by the bankrupt. To allow respondent to satisfy the judgment for penalty by mere déduction from its claim against the bankrupt’s estate is to detract from the pun-ishment definitely prescribed. The sentence specifically required by the law may not be eut down by implication, set-off or construction; for that would narrow the statute and tend to defeat its purpose. See United States v. Wiltberger, 5 Wheat. 76, 95. Fasulo v. United States, 272 U. S. 620, 628. The right of set-off here involved does not at ail dépend upon the Tennessee«statute upon which, at least in part, the state suprême court rested its ruling. Sections 5197 and 5198, Revised Statutes, define petitioner’s right to recover, and respondent’s liability for, the penalty; the Bankruptcy Act governs liquidation and distribution of the bankrupt’s estate. It results that the valid-ity of the challenged provision of the decree dépends upon the right of set-off in bankruptcy. Bankruptcy Act, § 68 (a), 11 U. S. C. § 108 (a). Cf. Yates v. Jones National Bank, 206 U. S. 158, 179. F armer s’ & Mechanics’ National Bank N. Dearing, supra. McDaniel National Bank v. Bridwell, 74 F. (2d) 331. Section 68 (a) déclarés: “In ail cases of mutual debts or mutual crédits between the estate of a bankrupt and a créditer the account shall be stated and one debt shall be set off against the other, and the balance only shall be allowed and paid.” The words “debts” and “crédits” as there used are corrélative. What is a debt on one side is a crédit on the other. Libby v. Hopkins, 104 U. S. McCOLLUM v. HAMILTON NAT. BANK. 249 245 Opinion of the Court. 303, 309. Liability for the penalty does not arise in contract but is laid in invitum as a disciplinary measure. Nor does the judgment determining the extent of guilt and declaring sentence change the liability for penalty to one for debt. Chase v. Curtis, 113 U. S. 452, 463-464. Boynton n. Hall, 121 U. S. 457, 465-466. As the penalty may be enforced only in a suit brought exclusively for that purpose so that the trial of guilt or innocence may not be embarrassed by any other question, it is plain that the payment of any debt owed by the plaintiff to the bank may not be held a condition precedent to the détermination of that issue. Punishment for usury does not dépend upon payment of the borrow-er’s debt. It follows that respondent is not entitled to satisfy petitioner’s judgment by deducting the amount of it from respondent’s claim against the bankrupt’s es-tate. Meredith v. American National Bank, 127 Tenn. 90, 94; 153 S. W. 479. Exeter National Bank v. Orchard, 43 Neb. 579, 582; 61 N. W. 833. Morehouse v. Second National Bank, 30 Hun 628. Reason, well supported by authority, requires that the penalty for usury so specifi-cally prescribed shall be paid according to the terms of the statute. Reversed. Mr. Justice Cardozo took no part in the considération or decision of this case. 250 OCTOBER TERM, 1937. Syllabus. 303 U. S. WESTERN LIVE STOCK et al. v. BUREAU OF REVENUE et al. APPEAL FROM THE SUPREME COURT OF NEW MEXICO. No. 322. Argued January 31, 1938.—Decided February 28, 1938. 1. The mere formation of a contract between persons of different States is not within the protection of the commerce clause, unless the performance is within its protection, at least in the absence of Congressional action. P. 253. 2. Taxation of a local business or occupation which is separate and distinct from the transportation and intercourse which are Interstate commerce is not forbidden merely because, in the ordinary course, such transportation or intercourse is induced or occasioned by the business. P. 253. 3. A statute of New Mexico levied on ail engaged within the State in the business of publishing newspapers or magazines a privilège tax of 2% on the gross receipts from the sale of advertising. Appellants, whose only office and place of business was within the State, prepared, edited and published there a journal, the circulation of which was partly interstate. Part of their receipts from advertising was derived from contracts with advertisers out of the State. Such contracts involved interstate transmission, from advertisers to appellants, of cuts, mats, information, copy, etc.; also payment through interstate facilities. Held, the tax as applied to appellants in respect of the sums received under such advertising contracts did not infringe the commerce clause of the Fédéral Constitution. Pp. 259-260. So far as the advertising rates reflected a value attributable to the maintenance of a circulation of the magazine interstate, the burden on the interstate business was too remote and too attenuated to call for a rigidly logical application of the doctrine that gross receipts from interstate commerce may not be made the measure of a tax. 4. The commerce clause does not relieve those engaged in interstate commerce from their just share of the state tax burden, even though the cost of doing the business be thereby increased. P. 254. 5. The vice characteristic of such local taxes, measured by gross receipts from interstate commerce, as hâve been held invalid, was that they placed on the commerce burdens of such a nature as WESTERN LIVE STOCK v. BUREAU. 251 250 Opinion of the Court. were capable, in point of substance, of being imposed, or added to, with equal right by every State which the commerce touched, merely because Interstate commerce was being done, so that with-out the protection of the commerce clause it would bear cumulative burdens not imposed on local commerce. The tax here in-volved is not subject to that objection. P. 255. 6. The business of preparing, printing and publishing magazine ad-vertising is peculiarly local and distinct from its circulation whether or not that circulation be Interstate commerce. P. 258. 7. In reconciling opposing demands that Interstate commerce bear its share of local taxation, and, on the other hand, not be sub-jected to multiple tax burdens merely because it is Interstate commerce, practical rather than logical distinctions must be sought. P. 259. 8. Fisher’s Blend Station v. State Tax Comm’n, 297 U. S. 650, and Crew Levick Co. v. Pennsylvania, 245 U. S. 292, distinguished. Pp. 260-261. 41 N. M. 288; 67 P. 2d 505, affirmed. Appeal from a judgment affirming a judgment against the appellants in a suit brought by them to recover taxes paid under protest and alleged to hâve been unlawfully exacted. Mr. D. A. Macpherson, Jr., with whom Mr. J. R. Modrall was on the brief, for appellants. Mr. Frank H. Patton, Attorney General, with whom Mr. Richard E. Manson, Assistant Attorney General, of New Mexico, was on the brief, for appellees. Mr. Justice Stone delivered the opinion of the Court. Section 201, c. 7, of the New Mexico Spécial Session Laws of 1934, levies a privilège tax upon the gross re-ceipts of those engaged in certain specified businesses.1 1 “Sec. 201. There is hereby levied, and shall be collected by the Tax Commission, privilège taxes, measured by the amount or volume of business done, against the persons, on account of their business 252 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. Subdivision I imposes a tax of 2% of amounts received from the sale of advertising space by one engaged in the business of publishing newspapers or magazines. The question for decision is whether the tax laid under this statute on appellants, who sell without the state, to ad-vertisers there, space in a journal which they publish in New Mexico and circulate to subscribers within and without the state, imposes an unconstitutional burden on interstate commerce. Appellants brought the présent suit in the state district court to recover the tax, which they had paid under protest, as exacted in violation of the commerce clause of the Fédéral Constitution. The trial court overruled a demur-rer to the complaint and gave judgment for appellants, which the Suprême Court reversed. 41 N. M. 141 ; 65 P. 2d 863. Appellants refusing to plead further, the district court gave judgment for the appellees, which the Suprême Court affirmed. 41 N. M. 288; 67 P. 2d 505. The case cornes here on appeal from the second judgment under § 237 of the Judicial Code. Appellants publish a monthly livestock trade journal which they wholly préparé, edit, and publish within the state of New Mexico, where their only office and place of business is located. The journal has a circulation in New Mexico and other States, being distributed to paid subscribers through the mails or by other means of transportation. It carries advertisements, some of which are activities, engaging, or continuing, within the State of New Mexico, in any business as herein defined, and in the amounts detennined by the application of rates against gross receipts, as follows: “I—At an amount equal to two percent of the gross receipts of any person engaging or continuing in any of the following busi-nesses: . . . publication of newspapers and magazines (but the gross receipts of the business of publishing newspapers or magazines shall include only the amounts received for the sale of advertising space) . . .” WESTERN LIVE STOCK v. BUREAU. 253 250 Opinion of the Court. obtained from advertisers in other states through appel-lants’ solicitation there. Where such contracts are entered into, payment is made by remittances to appellants sent interstate; and the contracts contemplate and provide for the interstate shipment by the advertisers to appellants of advertising cuts, mats, information and copy. Payment is due after the printing of such advertisements in the journal and its ultimate circulation and distribution, which is alleged to be in New Mexico and other states. Appellants insist here, as they did in the state courts, that the sums earned under the advertising contracts are immune from the tax because the contracts are entered into by transactions across state lines and resuit in the like transmission of advertising materials by advertisers to appellants, and also because performance involves the mailing or other distribution of appellants’ magazines to points without the state. That the mere formation of a contract between persons in different states is not within the protection of the commerce clause, at least in the absence of Congressional action, unless the performance is within its protection, is a proposition no longer open to question. Paul v. Virginia, 8 Wall. 168; Hooper v. California, 155 U. S. 648; New York Life Ins. Co. v. Deer Lodge County, 231 U. S. 495; cf. Ware & Léland v. Mobile County, 209 U. S. 405; Engél v. O’Malley, 219 U. S. 128. Hence it is unnecessary to consider the impact of the tax upon the advertising contracts except as it affects their performance, presently to be discussed. Nor is taxation of a local business or occupation which is separate and distinct from the transportation and intercourse which is interstate commerce forbidden merely because in the ordinary course such transportation or intercourse is induced or occasioned by the business. Williams v. Fears, 179 U. S. 270; Ware & Leland N. Mobile County, supra; Browning v. Way cross, 254 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. 233 U. S. 16; General Railway Signal Co. v. Virginia, 246 U. S. 500, 510; Utah Power & Light Co. v. Pjost, 286 U. S. 165. Here the tax which is laid on the compensation received under the contract is not forbidden either because the contract, apart from its performance, is within the protection of the commerce clause, or because as an incident preliminary to printing and publishing the adver-tisements the advertisers send cuts, copy and the like to appellants. We turn to the other and more vexed question, whether the tax is invalid because the performance of the contract, for which the compensation is paid, involves to some extent the distribution, interstate, of some copies of the magazine containing the advertisements. We lay to one side the fact that appellants do not allégé specifically that the contract stipulâtes that the advertisements shall be sent to subscribers out of the state, or is so framed that the compensation would not be earned if subscribers out-side the state should cancel their subscriptions. We assume the point in appellants’ favor and address ourselves to their argument that the présent tax infringes the commerce clause because it is measured by gross receipts which are to some extent augmented by appellants’ maintenance of an interstate circulation of their magazine. It was not the purpose of the commerce clause to re-lieve those engaged in interstate commerce from their just share of state tax burden even though it increases the cost of doing the business. “Even interstate business must pay its way,” Postal Telegraph-Cable Co. v. Richmond, 249 U. S. 252, 259 ; Ficklen v. Shelby County Taxing Dist., 145 U. S. 1, 24; Postal Telegraph Cable Co. v. Adams, 155 U. S. 688, 696; Galveston, H. & S. A. Ry. Co. v. Texas, 210 U. S. 217, 225, 227, and the bare fact that one is carrying on interstate commerce does not relieve him from many forms of state taxation which add to the cost of his business. He is subject to a property tax on WESTERN LIVE STOCK v. BUREAU. 255 250 Opinion of the Court. the instruments employed in the commerce. Western Union Teleg. Co. v. Attorney General, 125 U. S. 530; Cleveland, C., C. & St. L. Ry. Co. n. Backus, 154 U. S. 439; Adams Express Co. v. Ohio State Audit or, 165 U. S. 194; Adams Express Co. v. Kentucky, 166 U. S. 171; Western Union Tel. Co. v. Missouri ex rel. Gottlieb, 190 U. S. 412; Old Dominion S. S. Co. v. Virginia, 198 U. S. 299, and if the property devoted to interstate transportation is used both within and without the state a tax fairly apportioned to its use within the state will be sustained. Pullman’s Palace Car Co. v. Pennsylvania, 141 U. S. 18; Cudahy Packing Co. v. Minnesota, 246 U. S. 450. Net earnings from interstate commerce are subject to income tax, United States Glue Co. v. Oak Creek, 247 U. S. 321, and if the commerce is carried on by a corporation a franchise tax may be imposed, measured by the net income from business done within the state, including such portion of the income derived from interstate commerce as may be justly attributable to business done within the state by a fair method of apportionment. Underwood Typewriter Co. v. Chamberlain, 254 U. S. 113; cf. Bass, Ratcliff & Gretton v. State Tax Comm’n, 266 U. S. 271. Ail of these taxes in one way or another add to the expense of carrying on interstate commerce, and in that sense burden it; but they are not for that reason pro-hibited. On the other hand, local taxes, measured by gross receipts from interstate commerce, hâve often been pronounced unconstitutional. The vice characteristic of those which hâve been held invalid is that they hâve placed on the commerce burdens of such a nature as to be capable, in point of substance, of being imposed (Fargo N. Michigan, 121 U. S. 230; Philadelphia & Sou. S. S. Co. N. Pennsylvania, 122 U. S. 326; Galveston, H. & S. A. R. Co. v. Texas, supra; Meyer v. Wells, Fargo & Co., 223 U. S. 298) or added to (Crew Levick Co. v. Pennsylvania, 245 U. S. 292; Fisher’s Blend Station v. State Tax 256 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. Comm’n, 297 U. S. 650) with equal right by every state which the commerce touches, merely because interstate commerce is being done, so that without the protection of the commerce clause it would bear cumulative burdens not imposed on local commerce. See Philadelphia & Sou. S. S. Co. v. Pennsylvania, supra, 346; Case of State Freight Tax, 15 Wall. 232, 280; Bradley, J., dissenting in Maine v. Grand Trunk Ry. Co., 142 U. S. 217, 235; cf. Pullman’s Palace Car Co. v. Pennsylvania, supra, 26. The multiplication of state taxes measured by the gross receipts from interstate transactions would spell the destruction of interstate commerce and renew the barriers to interstate trade which it was the object of the commerce clause to remove. Baldwin v. G. A. F. Seelig, Inc., 294 U. S. 511, 523. It is for these reasons that a state may not lay a tax measured by the amount of merchandise carried in interstate commerce, Case of State Freight Tax, supra, or upon the freight eamed by its carnage. Fargo v. Michigan, supra; Philadelphia & Sou. S. S. Co. v. Pennsylvania, supra, restricting the effect of State Tax on Railway Gross Receipts, 15 Wall. 284, with which compare Miller, J., dissenting in that case at p. 297. Taxation measured by gross receipts from interstate commerce has been sus-tained when fairly apportioned to the commerce carried on within the taxing state, Wisconsin & M. Ry. Co. v. Powers, 191 U. S. 379; Maine n. Grand Trunk Ry. Co., supra; Cudahy Packing Co. v. Minnesota, supra; United States Express Co. v. Minnesota, 223 U. S. 335, and in other cases has been rejected only because the apportion-ment was found to be inadéquate or unfair. Fargo v. Michigan, supra; Galveston, H. & S. A. R. Co. v. Texas, supra; Meyer v. Wells, Fargo & Co., supra, with which compare Wisconsin & M. Ry. Co. v. Powers, supra. Whether the tax was sustained as a fair means of meas-uring a local privilège or franchise, as in Maine v. Grand Trunk Ry. Co., supra; Ficklen v. Shélby County Taxing WESTERN LIVE STOCK v. BUREAU. 257 250 Opinion of the Court. Dist., supra; American Manufacturing Co. v. St. Louis, 250 U. S. 459, or as a method of arriving at the fair measure of a tax substituted for local property taxes, Cudahy Packing Co. v. Minnesota, supra; United States Express Co. v. Minnesota, supra; cf. Postal Telegraph Cable Co. v. Adams, supra; see McHenry n. Alford, 168 U. S. 651, 670-671, it is a practical way of laying upon the commerce its share of the local tax burden without subjecting it to multiple taxation not borne by local commerce and to which it would be subject if gross receipts, unapportioned, could be made the measure of a tax laid in every state where the commerce is carried on. A tax on gross receipts from tolls for the use by interstate trains of tracks lying wholly within the taxing state is valid, New York, L. E. & W. R. Co. v. Pennsylvania, 158 U. S. 431; cf. Henderson Bridge Co. v. Kentucky, 166 U. S. 150, although a like tax on gross receipts from the rental of railroad cars used in interstate commerce both within and without the taxing state is invalid. Fargo v. Michigan, supra. In the one case the tax reaches only that part of the commerce carried on within the taxing state; in the other it extends to the commerce carried on without the state boundaries, and, if valid, could be similarly laid in every other state in which the business is con-ducted. In the présent case the tax is, in form and substance, an excise conditioned on the carrying on of a local business, that of providing and selling advertising space in a pub-lished journal, which is sold to and paid for by subscribers, some of whom receive it in interstate commerce. The price at which the advertising is sold is made the measure of the tax. This Court has sustained a similar tax said to be on the privilège of manufacturing, measured by the total gross receipts from sales of the manufactured goods both intrastate and interstate. American Manufacturing Co. v. St. Louis, supra, 462. The actual sales prices which 53383°—38------17 258 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. measured the tax were taken to be no more than the meas-ure of the value of the goods manufactured, and so an appropriate measure of the value of the privilège, the taxation of which was deferred until the goods were sold. Ficklen v. Shelby County Taxing Dist., supra, sustained a license tax measured by a percentage of the gross annual commissions received by brokers engaged in negotiating sales within for sellers without the state. Viewed only as authority, American Manufacturing Co. v. St. Louis, supra, would seem décisive of the présent case. But we think the tax assailed here finds support in reason, and in the practical needs of a taxing System which, under constitutional limitations, must accommo-date itself to the double demand that interstate business shall pay its way, and that at the same time it shall not be burdened with cumulative exactions which are not similarly laid on local business. As we hâve said, the carrying on of a local business may be made the condition of state taxation, if it is distinct from interstate commerce, and the business of pre-paring, printing and publishing magazine advertising is peculiarly local and distinct from its circulation whether or not that circulation be interstate commerce. Cf. Puget Sound Stevedoring Co. v. State Tax Comm’n, 302 U. S. 90, 94. No one would doubt that the tax on the privilège would be valid if it were measured by the amount of advertising space sold. Utah Power & Light Co. v. Pjost, supra; Fédéral Compress & W. Co. v. McLean, 291 U. S. 17, or by its value. Oliver Iron Mining Co. v. Lord, 262 U. S. 172; H ope Natural Gas Co. v. Hall, 274 U. S. 284. Selling price, taken as a measure of value whose accuracy appellants do not challenge, is for ail practical purposes a convenient means of arriving at an équitable measure of the burden which may be imposed on an admittedly taxable subject matter. Un-like the measure of the tax sustained in American Man-ujacturing Co. n. St. Louis, supra, it does not embrace WESTERN LIVE STOCK v. BUREAU. 259 250 Opinion of the Court. the purchase price (here the magazine subscription price) of the articles shipped in interstate commerce. So far as the advertising rates reflect a value attributable to the maintenance of a circulation of the magazine interstate, we think the burden on the interstate business is too remote and too attenuated to call for a rigidly logical application of the doctrine that gross receipts from interstate commerce may not be made the measure of a tax. Expérience has taught that the opposing demands that the commerce shall bear its share of local taxation, and that it shall not, on the other hand, be subjected to multiple tax burdens merely because it is interstate commerce, are not capable of réconciliation by resort to the syllogism. Practical rather than logical distinctions must be sought. See Galveston, H. & S. A. R. Ço. v. Texas, supra, 227. Recognizing that not every local law that affects commerce is a régulation of it in a constitutional sense, this Court has held that local taxes may be laid on property used in the commerce ; that its value for taxation may include the augmentation attributable to the commerce in which it is employed; and, finally, that the équivalent of that value may be computed by a measure related to gross receipts when a tax of the latter is sub-stituted for a tax of the former. See Galveston, H. & S. A. R. Co. v. Texas, supra, 225. Here it is perhaps enough that the privilège taxed is of a type which has been regarded as so separate and distinct from interstate transportation as to admit of different treatment for purposes of taxation, Utah Light Æ Power Co v. Pfost, supra; Fédéral Compress & W. Co. v. McLean, supra; Chassaniol v. Greenwood, 291 U. S. 584, and that the value of the privilège is fairly measured by the receipts. The tax is not invalid because the value is enhanced by appellant’s circulation of their journal interstate any more than property taxes on railroads are invalid because property value is increased by the cir-cumstance that the railroads do an interstate business. 260 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. But there is an added reason why we think the tax is not subject to the objection which has been leveled at taxes laid upon gross receipts derived from Interstate communication or transportation of goods. So far as the value contributed to appellants’ New Mexico business by circulation of the magazine Interstate is taxed, it cannot again be taxed elsewhere any more than the value of railroad property taxed locally. The tax is not one which in form or substance can be repeated by other States in such manner as to lay an added burden on the Interstate distribution of the magazine. As already noted, receipts from subscriptions are not included in the measure of the tax. It is not measured by the extent of the circulation of the magazine Interstate. Ail the events upon which the tax is conditioned—the préparation, printing and publication of the advertising matter, and the receipt of the sums paid for it—occur in New Mexico and not elsewhere. Ail are beyond any control and taxing power which, without the commerce clause, those States could exert through its dominion over the distribution of the magazine or its subscribers. The dangers which may ensue from the imposition of a tax measured by gross receipts derived directly from Interstate commerce are absent. In this and other ways the case differs from Fisher’s Blend Station v. State Tax Comm’n, supra, on which appellants rely. There the exaction was a privilège tax laid upon the occupation of broadcasting, which the Court held was itself Interstate communication, comparable to that carried on by the telegraph and the téléphoné, and was measured by the gross receipts derived from that commerce. If broadcasting could be taxed, so also could réception. Station WBT, Inc. v. Poulnot, 46 F. (2d) 671.2 ?Great Britain levies an annual license tax on radio receiving apparatus. See Wireless Telegraphy Act of 1904, c. 24, 4 Edw. 7, as explained by c. 67, 15 & 16 Geo. 5, and implemented by régulation printed in Great Britain, Post Office Guide, July, 1936, LABOR BD. v. GREYHOUND LINES. 261 250 Syllabus. In that event a cumulative tax burden would be imposed on interstate communication such as might ensue if gross receipts from interstate transportation could be taxed. This was the vice of the tax of a percentage of the gross receipts from goods sold by a wholesaler in interstate commerce, held invalid in Crew Levick Co. v. Pennsylvania, supra. In form and in substance the tax was thought not to be one for the privilège of doing a local business separable from interstate commerce. Cf. American Man-ujacturing Co. N. St. Louis, supra. In none of these respects is the présent tax objectionable. Affirmed. Mr. Justice McReynolds and Mr. Justice Butler are of opinion that the judgment should be reversed. Mr. Justice Cardozo took no part in the considération or decision of this case. NATIONAL LABOR RELATIONS BOARD v. PENNSYLVANIA GREYHOUND LINES, INC., et al. CERTIORARI TO THE CIRCUIT COURT OF APPEALS FOR THE THIRD CIRCUIT. No. 413. Argued February 4, 1938.—Decided February 28, 1938. 1. Upon a finding that an employer has created and fostered a labor organization of employées and dominated its administration in violation of § 8 (1), (2) of the National Labor Relations Act of July 5, 1935, the National Labor Relations Board has au-thority, under § 10 (c) of the Act, in addition to ordering the employer to cease these practices, to require him to withdraw ail récognition of the organization as the représentative of his employées and to post notices informing them of such withdrawal. Pp. 263, 268. 2. Whether continued récognition by the employer of the employées’ association would in itself be a continuing obstacle to the exercise of the employées’ right of self-organization and to bargain col- 262 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. lectively through représentatives of their own choosing, is an inference of fact to be drawn by the Board from the evidence reviewed in its subsidiary findings, and when supported by evidence the Board’s finding of the fact is conclusive. P. 270. 3. The Board’s findings in this case that the employer had engaged in unfair labor practices, and that withdrawal of récognition of the employée association by the employer, accompanied by suit-able publicity, would appropriately give effect to the policy of the Act, were amply supported by the evidence. P. 271. 4. To enable the Board to détermine whether the employer had violated the statute or to make an appropriate order against him, the presence of the employées’ association was not essential and it was not entitled to notice and hearing. P. 271. 5. An order of the Board such as that requiring the employer to withdraw récognition of the employées’ association, and to post notice of such action, lawful when made, does not become moot because it is obeyed or because changing circumstances may lessen the need for it. P. 271. 91 F. 2d 178, reversed. Certiorari, 302 U. S. 676, to review a judgment deny-ing in part a pétition of the National Labor Relations Board for enforcement of an order. Mr. Charles Fahy, with whom Solicitor General Reed, Assistant Solicitor General Bell, and Messrs. Robert L. Stem, Robert B. Watts, and Laurence A. Knapp were on the brief, for petitioner. Mr. Ivan Bowen, with whom Messrs. Charles H. Young and M. H. Boutelle were on the brief, for respondents. Mr. Justice Stone delivered the opinion of the Court. The main question for decision is whether, upon a finding that an employer has created and fostered a labor organization of employées and dominated its administration in violation of § 8 (1), (2) of the National Labor Relations Act of July 5, 1935 (c. 372, 49 Stat. 449, 29 U. S. C., § 151, et seq.), the National Labor Relations Board, in addition to ordering the employer to cease these practices, LABOR BD. v. GREYHOUND LINES. 263 261 Opinion of the Court. can require him to withdraw ail récognition of the or-ganization as the représentative of his employées and to post notices informing them of such withdrawal. Respondent Pennsylvania Greyhound Lines, Inc., is a corporation operating a passenger motor bus System be-tween the Atlantic Coast and Chicago and St. Louis. Respondent Greyhound Management Company, an affiliate of the Pennsylvania Company, performs various services relating to employée personnel of the latter and its affili-ated corporations. Together, respondents act as em-ployers of those employées working at the Pittsburgh Garage of the Pennsylvania Company and together ac-tively deal with labor relations of those employées. Upon charges filed by Local Division No. 1063, Amal-gamated Association of Street, Electric Railway and Motor Coach Employées of America, a labor organization, the Board issued its complaint, as permitted by § 1'0 (b) of the Act, charging that respondents had engaged in specified unfair labor practices affecting interstate commerce, in violation of § 8. After notice to respondents, and hearing, the Board found that they had engaged in unfair labor practices by interfering with, restraining, and coercing employées in the exercise of their rights, guaranteed by § 7, in that they had dominated and in-terfered with the formation and administration of a labor organization of their employées, Employées Association of the Pennsylvania Greyhound Lines, Inc., and had con-tributed financial and other support to it in violation of § 8 (1), (2). The Board ordered that respondents cease each of the specified unfair labor practices. It further ordered that they withdraw récognition from the Employées Association as employée représentative authorized to deal with respondents concerning grievances, terms of employment, and labor disputes, and that they post conspicuous notices in ail the places of business where such employées are en- 264 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. gaged, stating that the “Association is so disestablished and that respondents will refrain from any such récognition thereof.” 1 N. L. R. B. 1. Upon the Board’s pétition under § 10 (e) to enforce the order, heard April 1, 1936, the Court of Appeals for the Third Circuit gave judgment after a delay of one year and two months, during which there were three post-ponements and two rearguments. It struck from the order ail provisions requiring the withdrawal by respondents of récognition of the Employées Association and publication @f notice of withdrawal, and directed that in other respects the Board’s order be enforced. 91 F. (2d) 178. The court thought that the Board was without authority to order the employers to withhold récognition from the Association, without notice to it and opportunity for a hearing, and without an élection by the employées to choose a labor organization to represent them. We granted certiorari, 302 U. S. 676, the questions involved being of importance in the administration of the National Labor Relations Act. Respondents do not assail the Board’s findings of fact as without support in the evidence, and the principal questions for decision are of law, whether in the circum-stances disclosed by the findings the Board acted within the authority conferred upon it by §§ 7, 8 and 10 of the Act. Section 7 provides: “Employées shall hâve the right to self-organization, to form, join, or assist labor organizations, to bargain collectively through représentatives of their own choosing, and to engage in concerted activities, for the purpose of collective bargaining or other mutual aid or protection.” Section 8 déclarés: “It shall be an unfair labor practice for an employer— “(1) To interfère with, restrain, or coerce employées in the exercise of the rights guaranteed in section 7. LABOR BD. v. GREYHOUND LINES. 265 261 Opinion of the Court. “(2) To dominate or interfère with the formation or administration of any labor organization or contribute financial or other support to it: . . By § 10 (b) the Board is given authority to hear com-plaints of unfair labor practices upon evidence; and § 10 (c)1 directs that when the Board finds that any person has engaged in unfair labor practices it “shall issue and cause to be served on such person an order requiring such person to cease and desist from such unfair labor practice, and to take such affirmative action ... as will effec-tuate the policies of this Act. . . Notwithstanding the mandatory form of § 10 (c), its provisions in substance leave to the Board some scope for the exercise of judgment and discrétion in determin-ing, upon the basis of the findings, whether the case is one requiring an affirmative order, and in choosing the particular affirmative relief to be ordered. Hence, upon the challenge of the affirmative part of an order of the Board, we look to the Act itself, read in the light of its history, to ascertain its policy, and to the facts which the Board has found, to see whether they afford a basis for its judgment that the action ordered is an appropriate means of carrying out that policy. The history of the Act and its language show that its ruling purpose was to protect Interstate commerce by 1 “Sec. 10 (c). The testimony taken by such member, agent or agency or the Board shall be reduced to writing and filed with the Board. Thereafter, in its discrétion, the Board upon notice may take further testimony or hear argument. If upon ail the testimony taken the Board shall be of the opinion that any person named in the complaint has engaged in or is engaging in any such unfair labor practice, then the Board shall state its findings of fact and shall issue and cause to be served on such person an order requiring such person to cease and desist from such unfair labor practice, and to take such affirmative action, including reinstatement of employées with or without back pay, as will effectuate the policies of this Act. . . .” 266 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. securing to employées the rights established by § 7 to organize, to bargain collectively through représentatives of their own choosing, and to engage in concerted activi-ties for that and other purposes. National Labor Relations Board v. Jones & Laughlin Steel Corp., 301 U. S. 1, 23, 33. This appears both from the formai déclaration of policy in § 1 of the Act, National Labor Relations Board v. Jones Æ Laughlin Steel Corp., supra, 22-24, and from § 7, in itself a déclaration of the policy which, in conjunction with § 10 (c), it adopts as the controlling guide to administrative action. Before enactment of the National Labor Relations Act this Court had recognized that the maintenance of a “company union,” dominated by the employer, may be a ready and effective means of obstructing self-organization of employées and their choice of their own représentatives for the purpose of collective bargaining. Section 2 (3) of the Railway Labor Act of 1926, had provided that représentatives, for the purposes of the Act, should be desig-nated by employer and employées “without interférence, influence, or coercion exercised by either party over the self-organization or désignation of représentatives by the other.” We had held that in enforcing this provision, employer récognition of a company union might be en-joined and the union “disestablished,” as an appropriate means of preventing interférence with the rights secured to employées by the statute. Texas & N. O. R. Co. v. Brotherhood of Railway & S. S. Clerks, 281 U. S. 548, 560; see also Virginian Ry. Co. v. System Fédération No. 40, 300 U. S. 515, 542 et seq. Congress, in enacting the National Labor Relations Act, had in mind the expérience in the administration of the Railway Labor Act, and declared that the former was “an amplification and further clarification of the princi-ples” of the latter. Report of the House Committee on LABOR BD. v. GREYHOUND LINES. 267 261 Opinion of the Court. Labor, H. R. 1147, 74th Cong., Ist Sess., p. 3. It had before it the Railway Clerks case which had emphasized the importance of union récognition in securing collective bargaining, Report of the Senate. Committee on Education and Labor, S. Rep. 573, 74th Cong., Ist Sess., p. 17, and there were then available data showing that once an employer has conferred récognition on a particular or-ganization it has a marked advantage over any other in securing the adhérence of employées, and hence in pre-venting the récognition of any other.2 The National Labor Relations Act continued and amplified the policy of the Railway Labor Act by its déclaration in § 7, and by providing generally in § 8 that any interférences in the exercise of the rights guaranteed by § 7 and specifically the domination or interférence with the formation or administration of any labor organization were unfair labor practices. To secure to employées the benefits of self-organization and collective bargaining through représentatives of the employées’ own choosing, the Board was authorized by § 10 (c) to order the abandonment of unfair labor practices and to take affirmative action which would carry out the policy of the Act. In recommending the adoption of this latter provision the Senate Committee called attention to the decree which, in the Railway Clerks case, had compelled the employer to “disestablish its company union as représentative of its employées.” Report of the Senate Committee 2 On the significance of récognition in collective bargaining see Commons and Andrews, Principles of Labor Législation (Harper & Bros., 4th ed., 1936), p. 372; Catlin, The Labor Problem (Harper & Bros., 1935), pp. 431, 522; Rufener, Principles of Economies (Hough-ton-Mifllin Co., 1927), p. 399; Twentieth Century Fund, Inc., Labor and the Government (1935), p. 47; Yoder, Labor Economies and Labor Problems (1933), p. 443; U. S. Department of Labor, Bureau of Labor Statistics, Characteristics of Company Unions, Bulletin No. 634, Chs. VII, XXII. 268 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. on Education and Labor, supra. The report of the House Committee on Labor on this feature of the Act, after pointing ont that collective bargaining is “a sham when the employer sits on both sides of the table by supporting a particular organization with which he deals,” declared: “The orders will of course be adapted to the need of the individual case; they may include such matters as re-fraining from collective bargaining with a minority group, récognition of the agency chosen by the majority for the purposes of collective bargaining, posting of ap-propriate bulletins, refraining from bargaining with an organization corrupted by unfair labor practices.” Report of the House Committee on Labor, supra, pp. 18, 24. It is plain that the challenged provisions of the présent order are of a kind contemplated by Congress in the en-actment of § 10 (c) and are within its terms. There remains the question whether the findings adequately support them. The Board’s subsidiary findings of fact fully sustain its conclusion that respondents had engaged in unfair labor practices, by active participation in the organization and administration of the Employées Association, which they dominated throughout its history, and to whose financial support they had contributed; and that they had inter-fered with, restrained and coerced their employées in the exercise of the rights confirmed by § 7 to form for them-selves a labor organization and to bargain collectively through représentatives of their own choosing. It is unnecessary to repeat in full detail the facts dis-closed by the findings. They show that before the enact-ment of the National Labor Relations Act, respondents, whose employées were unorganized, initiated a project for their organization under company domination. In the course of its execution officers or other représentatives of respondent were active in promoting the plan, in LABOR BD. v. GREYHOUND LINES. 269 261 Opinion of the Court. urging employées to join, in the préparation of the details of organization, including the by-laws, in presiding over organization meetings, and in selecting employée représentatives of the organization. The by-laws and régulations provided that ail motorbus operators, maintenance men and clérical employées, after three months service, automatically became members of the Association, and that only employées were eligible to act as employée représentatives. No provisions were made for meetings of members, nor was a procedure established whereby employées might instruct their représentatives, or whereby those représentatives might disseminate information or reports. Grievances were to be taken up with régional committees with final review by a Joint Reviewing Committee made up of an equal number of régional chairmen and of management représentatives, but review in those cases could not be secured unless there was a joint submission of the controversy by employée and management représentatives. Change of the by-laws without employer consent was precluded by a provision that amendment should be only on a two-thirds vote of the Joint Reviewing Committee, composed of equal numbers of employer and employée représentatives. Employées paid no dues, ail the Association expenses being borne by the management. Although the Association was in terms created as a bar-gaining agency for the purpose of “providing adéquate représentation” for respondents’ employées by “securing for them satisfactory adjustment of ail controversial mat-ters,” it has functioned only to settle individual grievances. On the one recorded occasion when the employées sought a wage increase, the company représentatives pre-vented its considération by refusing to join in the submission to the Joint Reviewing Committee. In May, 1935, shortly before the passage of the Act, certain of respondents’ Pittsburgh employées organized a local union. Local Division No. 1063 of the Amalga- 270 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. mated Association of Street, Electric Railway and Motor Coach Employées of America, affiliated with the American Fédération of Labor, and continued to hold meetings of the organization after the passage of the Act on July 5, 1935. Before and after that date, respondents’ officers were active in warning employées against joining the union and in threatening them with discharge if they should join, and in keeping the union meetings under surveillance. Section 10 (e) déclarés that the Board’s findings of fact “if supported by evidence, shall be conclusive.” Whether the continued récognition of the Employées Association by respondents would in itself be a continuing obstacle to the exercise of the employées’ right of self-organization and to bargain collectively through représentatives of their own choosing, is an inference of fàct to be drawn by the Board from the evidence reviewed in its subsidiary findings. See Swayne & Hoyt N. United States, 300 U. S. 297. We may assume that .there are situations in which the Board would not be warranted in concluding that there was any occasion for withdrawal of employer récognition of an existing union before an élection by employées under § 9 (c), even though it had ordered the employer to cease unfair labor practices. But here respondents, by unfair labor practices, hâve succeeded in establishing a company-union so organized that it is incapable of functioning as a bargaining représentative of employées. With no procedure for meetings of members or for instructing employée représentatives, and with no power to bring griev-ances before the Joint Reviewing Committee without employer consent, the Association could not without amendment of its by-laws be used as a means of the collective bargaining contemplated by § 7 ; and amendment could not be had without the employer’s approval. LABOR BD. v. GREYHOUND LINES. 271 261 Opinion of the Court. In view of ali the circumstances the Board could hâve thought that continued récognition of the Association would serve as a means of thwarting the policy of collective bargaining by enabling the employer to induce adhérence of employées to the Association in the mistaken belief that it was truly représentative and afforded an agency for collective bargaining, and thus to prevent self-organization. The inferences to be drawn were for the Board and not the courts. Swayne & Hoyt N. United States, supra. There was ample basis for its conclusion that withdrawal of récognition of the Association by respondents, accompanied by suitable publicity, was an appropriate way to give effect to the policy of the Act. As the order did not run against the Association it is not entitled to notice and hearing. Its presence was not necessary in order to enable the Board to détermine whether respondents had violated the statute or to make an appropriate order against them. See General Invest-ment Co. v. Lake Shore & M. S. Ry. Co., 260 U. S. 261, 285-286. Respondents suggest that the case has become moot by reason of the fact that since the Board made its order it has certified the Brotherhood of Railroad Trainmen as représentative of the motorbus drivers of the Pennsylvania company for purposes of collective bargaining and that in a pending proceeding under § 9 (c) for the certification of a représentative of the other Pittsburgh employées, to which the Employées’ Association is not a party, the Pennsylvania company and Local Division No. 1063, who are parties, hâve made no objection to the proposed certification. But an order of the character made by the Board, lawful when made, does not become moot because it is obeyed or because changing circumstances indicate that the need for it may be less than when made. 272 OCTOBER TERM, 1937. Counsel for Parties. 303 U. S. We hâve considered but find it unnecessary to comment upon other objections to the order, of less moment. Reversed. Mr. Justice Cardozo and Mr. Justice Reed took no part in the considération or decision of this case. NATIONAL LABOR RELATIONS BOARD v. PACIFIC GREYHOUND LINES, INC. CERTIORARI TO THE CIRCUIT COURT OF APPEALS FOR THE NINTH CIRCUIT. No. 504. Argued February 4, 1938.—Decided February 28, 1938. 1. National Labor Relations Board v. Pennsylvania Greyhound Lines, ante, p. 261, followed. 2. The evidence and subsidiary findings in this case support the conclusion of the National Labor Relations Board that con-tinued récognition of a company union by an employer would be a continuing obstacle to the exercise of the employées’ right of self-organization and of collectively bargaining through représentatives of their own choosing, and justified its order requiring the employer to withdraw ail récognition of such union and give appropriate notice of the withdrawal to employées. P. 275. 91 F. 2d 458, reversed. Certiorari, 302 U. S. 679, to review a judgment setting aside, in part, an order of the National Labor Relations Board, upon a pétition for its enforcement. Mr. Charles Fahy, with whom Solicitor General Reed, Assistant Solicitor General Bell, and Messrs. Robert L. Stem, Robert B. Watts, and Laurence A. Knapp were on the brief, for petitioner. Mr. Ivan Bowen, with whom Mr. M. H. Boutelle was on the brief, for respondent. LABOR BD. v. PACIFIC LINES. 273 272 Opinion of the Court. Mr. Justice Stone delivered the opinion of the Court. This case, which cornes here on certiorari to the Court of Appeals for the Ninth Circuit, présents the same issues discussed in No. 413, National Labor Relations Board v. Pennsylvania Greyhound Lines, ante, p. 261, but on a somewhat different state of facts. The only question requiring separate considération is whether, in the case in which the National Labor Relations Board has or-dered respondent to cease certain unfair labor practices, including the domination and financial support of a company union, the facts justify its further order that respondent withdraw ail récognition of the union and give appropriate notice of the withdrawal to employées. The Court of Appeals for the Ninth Circuit sustained the Board’s findings and ail of its order except the affirmative parts relating to withdrawal of récognition of the company union, which it set aside. 91 F. (2d) 458. The authority conferred on the Board by § 10 (c) of the National Labor Relations Act to direct withdrawal of employer récognition when such an order will carry out the policies of the National Labor Relations Act was considered and sustained in the Pennsylvania Greyhound Lines case, supra. The question calling for attention here is whether the facts found by the Board afford a basis for its conclusion that the policies of the Act will be effectuated by the présent order. The findings show that respondent, an interstate carrier by motor bus, took an active and leading part in the organization in 1933 of the Drivers’ Association, a labor organization of its employées; that respondent had since continuously interfered with and dominated the internai administration of the Association, and contributed to its support; that through such domination it had obtained a 53383°—38-------18 274 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. “working agreement” with the Association in which it was stipulated that grievances of any employée should be presented first to his superior officer and then to respond-ent’s president, whose decision should be final. Before the enactment of the National Labor Relations Act, respondent twice made successful use of the Association as a means to forestall attempts to organize its employées, one in 1933 by the Brotherhood of Locomotive Engineers and Firemen, and another in 1934 by the employées themselves who sought to establish a Brotherhood of Motor Coach Operators. Respondent’s officers were active in persuading, threatening and coercing employées to join or remain members of the Drivers’ Association, and not to join the rival unions. In 1935, foliowing the passage of the National Labor Relations Act, there was a renewed but unsuccessful attempt by respondent’s employées to establish an organization affiliated with the Brotherhood of Locomotive Engineers and Firemen. The attempt was met by persuasions and wamings of respondent’s employées, by its officers, not to join the new union, and by threats of discharge if they should join. The Board found that the respondent had engaged in un-fair labor practices in violation of § 8 (1), (2), and ordered the cessation of these practices and withdrawal of respondent’s récognition of the Drivers’ Association. While the formai provisions, in constitution and by-laws, for insuring employer control of the company union in the Pennsylvania case are wanting here, the record shows, as the Board found, that employer control of the Drivers’ Association was none the less effective. During a period of three years it had been successfully used by respondent as an instrument for preventing three successive attempts for the organization by respondent’s employées of a union free from company domination. In LABOR BD. v. PACIFIC LINES. 275 272 Opinion of the Court. ordering withdrawal of récognition of the Drivers’ Association by respondent, the Board pointed out that a mere order to cease the unfair labor practices “would not set free the employee’s impulse to seek the organization which would most effectively represent him”; that continued récognition of the Drivers’ Association would provide respondent “with a device by which its power may now be made effective unobtrusively, ahnost without fur-ther action on its part. Even though he would not hâve freely chosen” the Association “as an initial proposition, the employée, once having chosen, may by force of a timorous habit, be held firmly to his choice. The employée must be released from these compulsions.” Whether the continued récognition of the Drivers’ Association by respondent would be a continuing obstacle to the exercise of the employées’ right of self-organization and to bargain collectively through représentatives of their own choosing, was an inference of fact which the Board could draw if there was evidence to support it. Section 10 (e) ; see Swayne & Hoyt v. United States, 300 U. S. 297. We cannot say that the Board’s conclusion was without support in the evidence and in the subsidiary findings which respondent does not challenge. Reversed. Mr. Justice Cardozo and Mr. Justice Reed took no part in the considération or decision of this case. 276 OCTOBER TERM, 1937. Counsel for Parties. 303 U. S. UNITED STATES v. KLEIN, ESCHEATOR OF PENNSYLVANIA. APPEAL FROM THE SUPREME COURT OF PENNSYLVANIA. No. 439. Argued February 11, 1938.—Decided February 28, 1938. 1. Moneys due by a défendant in a suit in the fédéral district court, to certain bondholders whose whereabouts were unknown, were by direction of the court paid into its registry. Unclaimed for more than five years, the fund was deposited in the U. S. Treasury, as required by R. S. § 996. Under that section the money remains subject to the order of the district court to be paid to the persons entitled to it upon full proof of their right. In the exercise of a jurisdiction conferred by state statute, a state court subsequently de-creed escheat of the fund and directed the state escheator to apply to the district court for an order that the money be paid to him. There was no contention on behalf of the United States of actual or possible escheat to the United States, or that it had any interest in the money adverse to the unknown bondholders. Held, that the decree of the state court was not an unconstitutional interférence with the fédéral court nor an invasion of the sovereignty of the United States. Pp. 280, 282. 2. While a fédéral court which has taken possession of property in the exercise of the judicial power conferred by the Constitution and laws of the United States is said to acquire exclusive jurisdiction, the jurisdiction is exclusive only in so far as restriction of the power of other courts is necessary for appropriate control and disposition of the property by the fédéral court. P. 281. 326 Pa. 260; 192 A. 256, affirmed. Appeal from a decree affirming a decree declaring an escheat of certain moneys, theretofore deposited in the fédéral Treasury pursuant to R. S. § 996, and authorizing the state escheator to prosecute the State’s claim to them. The United States appeared in opposition to the proceedings below, asserting jurisdictional objections. Assistant Attorney General Whitaker, with whom So-licitor General Reed, Assistant Solicitor General Bell, and Messrs. Paul A. Sweeney, and Henry A. Julicher were on the brief, for the United States. UNITED STATES v. KLEIN. 277 276 Opinion of the Court. Mr. A. Jere Creskoff, with whom Mr. Albert H. Lad-ner, Jr. was on the brief, for appellee. Mr. Justice Stone delivered the opinion of the Court. The question for decision is whether statutes of the Commonwealth of Pennsylvania, Purdon’s Penn. Statutes, Tit. 27, §§ 41, 45, 282, 334, are unconstitutional because they authorize interférence with a fédéral court and an invasion of the sovereignty of the United States, in so far as they purport to confer jurisdiction on a state tribunal to déclaré the escheat of moneys deposited in the registry of the fédéral court and later covered into the Treasury of the United States. In a suit brought by secured bondholders in the district court for eastern Pennsylvania to compel payment of the bonds by a défendant on the ground that it had appropriated the security to itself, a decree was entered in favor of the plaintiffs and other bondholders similarly situated, with provision for notice to the latter that they file their daims in the suit. Brown v. Pennsylvania Canal Co., 229 Fed. 444; Pennsylvania Canal Co. v. Brown, 235 Fed. 669; Brown N. Pennsylvania R. Co., 250 Fed. 513. It appearing that certain of the bondholders had not filed their daims and could not be found, the défendant was directed by the court to pay into its registry the money due to such bondholders, which was then placed in a designated despositary of the United States, in the name and to the crédit of the court, pur-suant to R. S. § 995, 28 U. S. C. § 851. On June 30, 1926, the fund was deposited in the Treasury of the United States as required by R. S. § 996, 28 U. S. C., § 852, in the case of funds paid into court and unclaimed for more than five years. In 1934 the présent appellee, as Escheator of the Commonwealth of Pennsylvania, proceeding under the Penn- 278 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. sylvania statutes which authorize the escheat of moneys paid into court where the persons entitled to them hâve remained unknown for seven years, petitioned the district court to déclaré an escheat of the fund. The court dis-missed the pétition, without préjudice, on the grounds that appellee had not yet procured a déclaration of escheat, which was deemed necessary in order to perfect the Com-monwealth’s title, and that the court was without jurisdiction to make such a déclaration. Thereupon the Pennsylvania escheat statutes were amended, Act of June 28, 1935, P. L. 475, to confer upon the Court of Common Pleas jurisdiction to decree an escheat of moneys de-posited in the custody or under the control of any court of the United States within the Commonwealth.1 1 As amended, the statutes provide : “Sec. 41. . . . Whenever an escheat has occurred, or shall occur, of any money or property deposited in the custody of, or under the control of, any court of the United States in and for any district within this Commonwealth, or in the custody of any depository, clerk or other officer of such court, the court of common pleas of the county in which such court of the United States sits, shall hâve jurisdiction to ascertain if an escheat has occurred, and to enter a judgment or decree of escheat in favor of the Commonwealth. “Sec. 282. . . . After the owner, bénéficiai owner, or person entitled to any of the following named moneys or property, shall be and remain unknown, or the whereabouts thereof shall hâve been unknown, for the period of seven successive years, such moneys or property shall be escheatable to the Commonwealth, and shall be escheated in the manner hereinafter provided, with interest actu-ally accrued thereon to the date of the decree for the escheat of the same, namely: . . . “(b) Any moneys, estate, or effects paid into or deposited in any court of this Commonwealth, or in any Fédéral court in and for any district within the Commonwealth, or in the custody of any officer of any such court. “Sec. 334. That whensoever any money, estate or effects, shall hâve been, or shall hereafter be paid into, or deposited in the custody or be under the control of any court of this Commonwealth, or of any court of the United States in and for any district within this UNITED STATES v. KLEIN. 279 276 Opinion of the Court. The présent suit was brought by appellee in the Court of Common Pleas, No. 5, of Philadelphia County, upon a pétition setting out the facts already detailed and pray-ing a déclaration that the fund had escheated to the Commonwealth. The United States appeared in the suit and moved to dismiss the pétition on the ground that the state court was without jurisdiction to escheat moneys in the custody of the United States or of its courts. The order of the Court of Common Pleas grant-ing the motion was reversed by the Suprême Court of Pennsylvania, which held that the statutes relating to escheat of funds in the custody of fédéral courts, conferred jurisdiction on the court to déclaré the escheat and was subject to no constitutional infirmity since exercise of that jurisdiction involved no interférence with the fédéral court and no attempted control over funds in its custody. 322 Pa. 481; 192 Atl. 256. The United States then filed an answer and upon a trial of the issues the Court of Common Pleas gave its decree declaring that the fund had escheated to the Commonwealth and that appellee had authority to claim it, and directing him to apply to the district court for an order that the moneys be paid to him as Escheator. The State Suprême Court affirmed so much of the decree as declared the escheat and authorized appellee to prosecute the claim of the Commonwealth to the moneys. 326 Pa. 260; 192 Atl. 256. From its decree of affirmance the case cornes here on appeal under § 237 of the Judicial Code. Section 996 of the Revised Statutes directs that when the right to moneys paid into fédéral courts has been ad- Commonwealth, or shall be in the custody of any depository, registry, or of any receiver, clerk, or other officer of any of said courts, and the rightful owner or owners thereof shall hâve been or shall be unknown for the space of seven years, the same shall escheat to the Commonwealth, subject to ail legal demands on the same.” 280 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. judicated and they are unclaimed for more than five years, they shall be deposited in the Treasury of the United States, in the name of the United States. It further provides: “Any person or persons or any corporation or company entitled to any such money may, on pétition to the court from which the money was received . . . and upon notice to the United States attorney and full proof of right thereto, obtain an order of court directing the payment of such money to the claimant, and the money deposited as aforesaid shall constitute and be a permanent appropriation for payments in obedience to such orders.” 2 The Government does not, in pleading or argument, set up any right, title or interest in the présent fund adverse to the unknown bondholders. It does not contend that the fund has been or can be escheated to the United States. It agréés with the contention of appellee, which we accept as correctly interpreting the applicable fédéral statutes, that the fund remains subject to the order of the district court to be paid to the persons lawfully entitled to it upon proof of their ownership. But it insists here, as in the state courts, that the decree declaring the escheat is an unconstitutional interférence with a court of the United States, an invasion of its sovereignty, and is an attempt, void under the Fourteenth Amendment, to exercise jurisdiction over the absent bondholders and 2 The Permanent Appropriation Repeal Act, June 26, 1934, c. 756, 48 Stat. 1224, 1230, § 17, déclarés that appropriation accounts appearing on the books of the govemment, including “Unclaimed moneys of individuals whose whereabouts are unknown (Justice),” “are abolished, and any unobligated balances under such accounts as of June 30, 1935, shall be covered into a trust fund receipt account in the Treasury to be designated ‘Unclaimed Moneys of Individuals Whose Whereabouts Are Unknown.’ . . . There are authorized to be appropriated, annually, from such account such sums as may be necessary to meet any expenditures of the character now charge-able to the appropriation accounts abolished by this section. . . UNITED STATES v. KLEIN. 281 276 Opinion of the Court. the moneys, neither of which are shown to be within the state. While a fédéral court which has taken possession of property in the exercise of the judicial power conferred upon it by the Constitution and laws of the United States is said to acquire exclusive jurisdiction, the jurisdiction is exclusive only in so far as restriction of the power of other courts is necessary for the fédéral court’s appropri-ate control and disposition of the property. Penn General Casualty Co. v. Pennsylvania ex rel. Schnader, 294 U. S. 189; see Leadville Coal Co. v. McCreery, 141 U. S. 475, 477. Other courts having jurisdiction to adjudicate rights in the property do not, because the property is possessed by a fédéral court, lose power to render any judgment not in conflict with that court’s authority to décidé questions within its jurisdiction and to make effective such decisions by its control of the property. Penn General Casualty Co. v. Pennsylvania ex rel. Schnader, supra; see Heidritter v. Elizabeth Oil-Cloth Co., 112 U. S. 294, 304; cf. Buck v. Colbath, 3 Wall. 334, 342; Riehle v. Margolies, 279 U. S. 218. Similarly a fédéral court may make a like adjudication with respect to property in the possession of a state court. Yonley v. Lavender, 21 Wall. 276; Byers v. McAuley, 149 U. S. 608, 620; Secur-ity Trust Co. v. Black River National Bank, 187 U. S. 211, 227; Waterman v. Canal-Louisiana Bank & T. Co., 215 U. S. 33, 43-46; Commonwealth Trust Co. v. Bradjord, 297 U. S. 613, 619; General Baking Co. v. Harr, 300 U. S. 433. In this case jurisdiction was acquired by the district court, by reason of diversity of citizenship, to adjudicate ,the rights of the parties. That function performed, it now retains jurisdiction for the sole purpose of making disposition of the fund under its control, by ordering pay-ment of it to the persons entitled as directed by the fédéral statute. Beyond whatever is needful and appropri- 282 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. ate to the accomplishment of that end, the jurisdiction and possession of the fédéral district court does not oper-ate to curtail the power which the state may constitution-ally exercise over persons and property within its ter-ritory. The présent decree for escheat of the fund is not founded on possession and does not disturb or purport to affect the Treasury’s possession of the fund or the district court’s authority over it. Nor could it do so. Penn General Casualty Co. v. Pennsylvania, supra; United States v. Bank of New York & T. Co., 296 U. S. 463, 478. At most the decree of the state court purports to be an adjudication upon the title of the unknown claim-ants in the fund by a proceeding in the nature of an in-quest of office as in the case of escheated lands, compare Security Savings Bank n. California, 263 U. S. 282, 287, with Hamilton v. Brown, 161 U. S. 256, 263, and to con-firm the authority of appellee to make claim to the moneys. It is subordinate to every right asserted and decreed in the fédéral suit and effective only so far as it establishes rights derived from them. Neither the nature of the suit in the district court nor the fédéral stat-utes preclude transfer of or change in the interest of the unknown claimants, either by judicial proceedings in the state court or otherwise, pending final disposition of the fund by the fédéral court. Section 996 of the Revised Statutes contemplâtes that changes in ownership of the fund may occur, since it provides that after the right to the fund has been finally adjudicated and it has been cov-ered into the Treasury it shall be paid over to any person entitled, upon full proof of his right to receive it. Since the Government has not set up and does not assert any claim or interest in the fund apart from the possession acquired under the decree of the district court and the statutes of the United States, it is unnecessary to con-sider now the effect on the decree of the state court of the fund’s absence from the state, and the absence or ST. PAUL INDEMNITY CO. v. CAB CO. 283 276 Counsel for Parties. nonresidence of the unknown claimants, if such is the case. Ail such questions will be open and may be raised and decided whenever application is made to the district court for payment over of the fund. Affirmed. Mr. Justice Cardozo and Mr. Justice Reed took no part in the considération or decision of this case. SAINT PAUL MERCURY INDEMNITY CO. v. RED CAB COMPANY. CERTIORARI TO THE CIRCUIT COURT OF APPEALS FOR THE SEVENTH CIRCUIT. No. 274. Submitted January 10, 1938.—Decided February 28, 1938. 1. There is a strong presumption that the plaintiff in a state court has not claimed a large amount in order to confer jurisdiction by removal on a fédéral court, and that the parties hâve not colluded to that end. P. 290. 2. The status of the case as disclosed by the plaintiff’s complaint is controlling in the case of a removal, since the défendant must file his pétition before the time for answer or forever lose his right to remove. P. 291. 3. Jurisdiction of the District Court acquired through removal is not lost by plaintiff’s subséquent réduction of his claim to less than the jurisdictional amount. P. 292. 90 F. 2d 229, reversed. Certiorari, 302 U. S. 669, to review a judgment dis-missing an appeal from a judgment recovered in an action on a contract of insurance. The action had been removed from a state court. The respondent here conceded that the ruling below was erroneous and prayed that the cause be remanded for decision of the merits. Mr. Burke G. Slaymaker submitted on brief for petitioner. Mr. William E. Reiley submitted for respondent. 284 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. Mr. Justice Roberts delivered the opinion of the Court. The decision under review is that, although, at the time of removal of a cause from a state court, the complaint disclosed an amount in controversy requisite to the fédéral court’s jurisdiction, a subséquent amendment, reduc-ing the sum claimed to substantially less than that amount, nécessitâtes remand to the state court. We granted the writ of certiorari because of alleged conflict with our decisions and with those of other fédéral courts. The respondent, a corporation of Indiana, issued a summons out of the Superior Court of Marion County, Indiana, against the petitioner, a Minnesota corporation doing business in Indiana, and one Harlan as its agent. The complaint alleged that the respondent was subject to the provisions of the Indiana Workmen’s Compensation Act and had entered into a contract of Insurance with the petitioner, evidenced by a binder, whereby the petitioner insured the respondent against loss or expense by reason of claims for compensation for a period of thirty days from December 30, 1933, and agreed to act for the respondent in the filing of reports and notices under the Act ; that, during the term of the insurance, employés of the respondent had suffered injury in the course of employment and made claims therefor; that the petitioner had been notified of each in jury and investigated it in connection with the claim for compensation; that after the expiration of the contract the petitioner notified the respondent that it would not recognize any of the claims and denied liability under the binder; that as a conséquence respondent was compelled to employ attorneys, investigators, and medical assistants to investigate and satisfy claims covered by the contract and to pay employés who had suffered injuries during the contract period, and ST. PAUL INDEMNITY CO. v. CAB CO. 285 283 Opinion of the Court. to pay, or obligate itself to pay, for medical, hospital, or dental bills in connection with such injuries; to the damage of the respondent in the sum of $4,000. It was alleged that the petitioner had acted, in making the contract, through Harlan, its authorized agent and représentative, and an order was prayed that Harlan retain ail moneys due by him to the petitioner for the purpose of answering any judgment which might be recovered. The complaint concluded by demanding $4,000 and other appropriate relief. Upon the petitioner’s timely application the cause was removed to the United States District Court for Southern Indiana. The respondent thereafter filed an amended complaint, the substance of which is not now material, and later a “second amended complaint for breach of contract and for damages,” in which the allégations of the original complaint were repeated and damages were claimed in the sum of $4,000. An exhibit was attached which gave the names of the employés and the amounts expended in connection with their asserted injuries totaling $1,380.89. The court dismissed Harlan as a défendant, transferred the cause to the law docket, and overruled a demurrer to the complaint as not stating facts sufficient to constitute a cause of action. The an-swer denied the making of the contract. A jury trial was waived and the court made findings, stated its conclusions, and entered judgment for the respondent for $1,162.98. The petitioner appealed. The Court of Ap-peals refused to décidé the merits on the ground that as the record showed respondent’s claim did not equal the amount necessary to give the District Court jurisdiction, the case should hâve been remanded to the state court.1 The question presented is one of statutory construction. The act defining the jurisdiction of district courts of the 190 F. (2d) 229. 286 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. United States is § 24 of the Judicial Code.2 So far as here material, the Code confers jurisdiction of a suit of a civil nature, where the matter in controversy exceeds, exclusive of interest and costs, the sum or value of $3,000 and is between citizens of different States. Authority for removal of certain causes from a state to a fédéral court was first given by § 12 of the Judiciary Act of 1789 3 which permitted removal of a civil suit, insti-tuted by a citizen of the state in which the suit was brought, against a citizen of another state, where the matter in dispute exceeded the sum or value of $500, exclusive of costs. Such removal could be had only at the instance of the nonresident défendant. The Act of July 27, 1866,4 enlarged the privilège of removal by provid-ing that if, in such a civil suit, it was shown that a nonresident défendant was party to a separable controversy, which could be deteï’mined without the presence of other défendants, that défendant might remove the cause. The Judiciary Act of 18755 altered preëxisting law to permit suits involving a controversy between citizens of different States to be removed by either party. The Judiciary Acts of 1887-1888 6 increased the jurisdictional amount to more than $2,000, exclusive of interest and costs, and confmed the right of removal to a nonresident défendant, and the Judicial Code increased the limit to over $3,000, exclusive of interest and costs, and also re-stricted the privilège to nonresident défendants.7 The 2 Act of March 3, 1911, c. 231, § 24, as amended, 36 Stat. 1091, U. S. C. Tit. 28, § 41. 3 Act of Sept. 24,1789, § 12, 1 Stat. 73, 79. 4 c. 288, 14 Stat. 306. 6 Act of March 3, 1875, 18 Stat. 470. 6 Act of March 3, 1887, § 1, 24 Stat. 552; Act of Aug. 13, 1888, § 1, 25 Stat. 433. 7 Act of March 3, 1911, c. 231, §§ 24 and 28, 36 Stat. 1087, 1091, 1094. ST. PAUL INDEMNITY CO. v. CAB CO. 287 283 Opinion of the Court. statute governing dismissal or remand for want of jurisdiction is § 37 of the Code.8 “If in any suit commenced in a district court, or re-moved from a State court to a district court of the United States, it shall appear to the satisfaction of the said district court, at any time after such suit has been brought or removed thereto, that such suit does not really and substantially involve a dispute or controversy properly within the jurisdiction of said district court, or that the parties to said suit hâve been improperly or collusively made or joined, either as plaintiffs or défendants, for the purpose of creating a case cognizable or removable under this chapter, the said district court shall proceed no fur-ther therein, but shall dismiss the suit or remand it to the court from which it was removed, as justice may re-quire, and shall make such order as to costs as shall be just. This provision first appeared as § 59 of the Act of March 3, 1875 {supra), and save for the élision of a con-cluding clause, and the substitution of “district court” for “circuit court,” is identical with that section. It was included in the Judiciary Acts of 1887-1888, supra, and has been continuously in force since 1875. It altered the practice by requiring the court to dismiss or remand of its own motion in a proper case although want of jurisdiction was not raised by appropriate motion or by plea or answer,10 but did not change the substantial basis for 8 Act of March 3,1911, c. 231, § 37, 36 Stat. 1098, U. S. C. Tit. 28, §80. 918 Stat. 472. 10 Prior to 1875 the courts did not act of their own motion but upon a motion to dismiss or a plea in abatement. Smith n. Ker-no^hen, 7 How. 198; McNutt v. General Motors Acceptance Corp., 298 U. S. 178, 183. Since then it has been their duty not only to act upon a motion to dismiss, (Steigleder n. McQuesten, 198 U. S. 141) or, if the state practice permits, upon a déniai of jurisdiction 288 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. the court’s action. The principles governing dismissal of a cause initiated in the fédéral court or the remand of one begun in a state court hâve remained as they were before the section was adopted. The intent of Congress drastically to restrict fédéral jurisdiction in controversies between citizens of different states has always been rigorously enforced by the courts. The rule governing dismissal for want of jurisdiction in cases brought in the fédéral court is that, unless the law gives a different rule, the sum claimed by the plaintiff Controls11 if the claim is apparently made in good faith.12 in the answer, (Gilbert v. David, 235 U. S. 561; North Pacific S. S. Co. v. Soley, 257 U. S. 216) but to act sua sponte (McNutt v. General Motors Acceptance Corp., supra, 184) upon any disclosure, whether in the pleadings or the proofs, which satisfies the court, in the exercise of a sound judicial discrétion, that the plaintiff did not in fact hâve a claim for the jurisdictional amount or value, and knew, or reasonably ought to hâve known, that fact. Williams v. NOttawa, 104 U. S. 209, 211; McNutt v. General Motors Acceptance Corp., supra, 184. It is plaintiff’s burden both to allégé with suffirent particularity the facts creating jurisdiction, in view of the nature of the right asserted, and, if appropriately challenged, or if inquiry be made by the court of its own motion, to support the allégation. McNutt v. General Motors Acceptance Corp., supra, pp. 182-189; KVOS n. Associated Press, 299 U. S. 269. Even an appellate court must notice the absence of the éléments requisite to original jurisdiction or to a removal. Williams n. Nottawa, supra; Robinson v. Anderson, 121 U. S. 522; McNutt v. General Motors Acceptance Corp., supra; American Bridge Co. v. Hunt, 130 Fed. 302; International & G. N. R. Co. v. Hoyle, 149 Fed. 180. 11 Wilson v. Daniel, 3 Dali. 401, 407, 408; Barry v. Edmunds, 116 U. S. 550; Sherman v. Clark, 3 McLean 91, Fed. Cas. 12763; Stuck-ert v. Alexander, 4 F. Supp. 172. l2Peéler v. Lathrop, 48 Fed. 780; Ung Lung Chung v. Holmes, 98 Fed. 323; Washington County v. Williams, 111 Fed. 801; Greene County Bank v. Teasdale Comm’n Co., 112 Fed. 801; Ameriçan Sheet & Tin Plate Co. v. Winzeler, 227 Fed. 321; Owen M. Bruner Co. v. O. R. Manefee Lumber Co., 292 Fed. 985; Walker Grain Co. v. Southwestem Tel, & Tel, Co,) 10 F, (2d) 272, ST. PAUL INDEMNITY CO. v. CAB CO. 289 283 Opinion of the Court. It must appear to a legal certainty that the claim is really for less than the jurisdictional amount to justify dis-missal.18 The inability of plaintiff to recover an amount adéquate to give the court jurisdiction does not show his bad faith or oust the jurisdiction.14 Nor does the fact that the complaint discloses the existence of a valid défense to the claim.15 But if, from the face of the plead-ings, it is apparent, to a legal certainty, that the plaintiff cannot recover the amount claimed, or if, from the proofs, the court is satisfied to a like certainty that the plaintiff never was entitled to recover that amount, and that his claim was therefore colorable for the purpose of confer-ring jurisdiction, the suit will be dismissed.16 Events oc- 13 Barry n. Edmunds, supra; Wetmore v. Rymer, 169 U. S. 115, 122; Put-In-Bay Waterworks Co. v. Ryan, 181 U. S. 409, 432-433; Hampton St ave Co. v. Gardner, 154 Fed. 805. 14 Smithers n. Smith, 204 U. S. 632; Holden n. Utah & M. M. Co., 82 Fed. 209; Maffet v. Quine, 95 Fed. 199; Kunkel n. Brown, 99 Fed. 593; Ung Lung Chung v. Holmes, supra; Washington County v. Williams, supra; Denver City Tramway Co. v. Norton, 141 Fed. 599; Hampton Stave Co. n. Gardner, supra; O. J. Lewis Mercantile Co. v. Klepner, 176 Fed. 343; St. Tammany Bank & T. Co. v. Win-field, 263 Fed. 371; Ragsdale v. Rudich, 293 Fed. 182; Walker Grain Co. v. Southwestem Tel. & Tel. Co., 10 F. (2d) 272; Kimel v. Missouri State Life Ins. Co., 71 F. (2d) 921; Simecek v. United States National Bank, 91 F. (2d) 214. 15 Interstate Bldg. & L. Assn. v. Edgefiéld Hôtel Co., 109 Fed. 692; Armstrong v. Walters, 219 Fed. 320; Mullins Lumber Co. v. Williamson & Brown Land Co., 246 Fed. 232. 16 Williams v. N Ottawa, supra; Barry v. Edmunds, supra; Vance v. W. A. Vandercook Co., 170 U. S. 468; Lion Bonding & S. Co. v. Karatz, 262 U. S. 77; First National Bank v. Louisiana Highway Comm’n, 264 U. S. 308; Simon v. House, 46 Fed. 317; Horst v. Merkley, 59 Fed. 502; Cabot v. McMaster, 61 Fed. 129; Bank of Arapahoe v. David Bradley & Co., 72 Fed. 867; Armstrong v. Walters, supra; Maurel v. Smith, 220 Fed. 195; Le Roy v. Hartwick, 229 Fed. 857; Sclarenco v. Chicago Bonding Co., 236 Fed. 592; Oper-ators Piano Co. v. First Wisconsin Trust Co., 283 Fed. 904; Wilder-man n. Roth, 17 F. (2d) 486; Chick v. New England Tel. & Tel. 53383°—38----------19 290 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. curring subséquent to the institution of suit which reduce the amount recoverable below the statutory limit do not oust jurisdiction.17 What already has been said, and circumstances later to be discussed, lead to the conclusion that a dismissal would not hâve been justified had the suit been brought in the fédéral court. The principles which govern re-mand of a removed cause, more urgently require that it should not hâve been remanded. In a cause instituted in the fédéral court the plaintiff chooses his forum. He knows or should know whether his claim is within the statutory requirement as to amount. His good faith in choosing the fédéral forum is open to challenge not only by resort to the face of his complaint, but by the facts dis-closed at trial, and if from either source it is clear that his claim never could hâve amounted to the sum neces-sary to give jurisdiction there is no injustice in dismissing the suit. Indeed, this is the court’s duty under the Act of 1875. In such original actions it may also well be that plaintiff and défendant hâve colluded to confer jurisdiction by the method of the one claiming a fictitious amount and the other failing to deny the veracity of the averment of amount in controversy. Upon disclosure of that state of facts the court should dismiss. A different situation is presented in the case of a suit instituted in a state court and thence removed. There is a strong presumption that the plaintiff has not claimed a large amount in order to confer jurisdiction on a fédéral court or that the parties hâve colluded to that end.18 Co., 36 F. (2d) 832; Nixon v. Town Taxi, Inc., 39 F. (2d) 618; Cohn n. Cities Service Co., 45 F. (2d) 687; Miller-Crenshaw Co. v. Colorado Mill Co., 84 F. (2d) 930. 17 Mutual Life Ins. Co. v. Rose, 294 Fed. 122; Hood v. Bell, 84 F. (2d) 136. 18 In Smith v. Greenhow, 109 U. S. 669, 671, a case of trespass for entering plaintiff’s premises and carrying away goods of the value of $100, interfering with plaintiff’s business, annoying and disturbing him, &c., the damages were laid at $6,000. Though there was not ST. PAUL INDEMNITY CO. v. CAB CO. 291 283 Opinion of the Court. For if such were the purpose suit would not hâve been instituted in the first instance in the state but in the fédéral court. It is highly unlikly that the parties would pursue this roundabout and troublesome method to get into the fédéral court by removal when by the sanie de-vice the suit could be instituted in that court.19 More-over, the status of the case as disclosed by the plaintiff’s complaint is controlling in the case of a removal, since the défendant must file his pétition before the time for answer or forever lose his right to remove.20 Of course, diversity of citizenship, as the pleadings raised a fédéral question, the cause was removed. It was remanded as the circuit court thought there was no fédéral question involved. The decision was reversed. Speaking of the facts disclosed the court said: “There is a ground for remanding the cause suggested by the record, but not sufiiciently apparent to justify us in resorting to it to support the action of the circuit court. The value of the property taken is stated in the déclaration to be but $100, although the damages for the alleged trespass are laid at $6,000. . . . We cannot, of course, assume as a matter of- law, that the amount laid, or a less amount, greater than $500, is not recoverable upon the case stated in the déclaration, and cannot therefore justify the order remanding the cause, on the ground that the matter in dispute does not exceed the sum or value of $500. But if the circuit court had found, as matter of fact, that the amount of damages stated in the déclaration was colorable, and had been laid beyond the amount of a reasonable expectation of recovery, for the purpose of creating a case removable under the act of Congress, so that, in the words of the 5th section of the act of 1875, it appeared that the suit ‘did not really and substantially involve a dispute or controversy properly within the jurisdiction of said circuit court/ the order remanding it to the State court could hâve been sustained.” This appears to be the only reported case of a removal by the plain-tiff as authorized by the Act of 1875, and is distinguishable on that ground, as respects the possibility that plaintiff’s claim may hâve been colorable for the purpose of removing the case. 19 Hayward v. Nordberg Mfg. Co., 85 Fed. 4, 9. (Per Taft, Lur-ton and Clark, JJ.) 20 Gordon v. Long est, 16 Pet. 97; Kanouse v. Martin, 15 How. 198; Chesbrough v. Northern Trust Co., 252 U. S. 83, affirming Chesbrough v. Woodworth, 251 Fed. 881; Muns v. DeNemours, 2 Wash. 292 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. if, upon the face of the complaint, it is obvious that the suit cannot involve the necessary amount, removal will be futile and remand will follow.21 But the fact that it appears from the face of the complaint that the défendant has a valid defense, if asserted, to ail or a portion of the claim, or the circumstance that the rulings of the district court after removal reduce the amount recoverable below the jurisdictional requirement,22 will not justify remand. And though, as here, the plaintiff after removal, by stipulation, by affidavit, or by amendment of his pleadings, reduces the claim below the requisite amount, this does not deprive the district court of jurisdiction.23 C. C. 463, Fed. Cas. 9931; Riggs v. Clark, 71 Fed. 560; Hayward v. Nordberg Mfg. Co., supra; Johnson v. Computing Scale Co., 139 Fed. 339. 21 North American T. & T. Co. v. Morrison, 178 U. S. 262. 22 Levinski v. Middlesex Banking Co., 92 Fed. 449; Tennent-Stribling Shoe Co. v. Roper, 94 Fed. 739; Mannheimer v. Neder-landsche, 6 F. Supp. 564. Contra: Jones v. Western Union Tel. Co., 233 Fed. 301. 23 Kanouse v. Martin, supra; Kirby v. American Soda Fountain Co., 194 U. S. 141; Wright v. Wells, Pet. C. C. 220, Fed. Cas. 18,101; Roberts v. Nelson, 8 Blatchf. 74, Fed. Cas. 11,907; Zinkeisen v. Hufschmidt, 1 Cent. L. J. 144, Fed. Cas. 18,214; Waite v. Phoenix Ins. Co., 62 Fed. 769; Riggs v. Clark, supra; Hayward v. Nordberg Mfg. Co., supra; Johnson v. Computing Scale Co., supra; Coffin v. Philadelphia, W. & B. R. Co., 118 Fed. 688; Donovan v. "Dixieland Amusement Co., 152 Fed. 661; Bernheim v. Louisvïïle Property Co., 221 Fed. 273; J ellison v. Krell Piano Co., 246 Fed. 509; Twin Hills Gasoline Co. v. Bradford OU Corp., 264 Fed. 440; Kane v. Reserve Oïl Corp., 52 F. (2d) 972; Travelers’ Protective Assn. v. Smith, 71 F. (2d) 511; Beddings n. Great Eastern Stages, Inc., 6 F. Supp. 529. Contra: Hughes & Co. v. Peper Tobacco Warehouse Co., 126 Fed. 687. In two tort cases where large damages were claimed, but it appeared at trial that plaintiff’s injuries and losses were so slight that a verdict for more than a fraction of the jurisdictional amount could not be sustained the courts remanded. Though not placed upon that ground, their action may hâve been ST. PAUL INDEMNITY CO. v. CAB CO. 293 283 Opinion of the Court. Thus events occurring subséquent to removal which reduce the amount recoverable, whether beyond the plaintiff’s control or the resuit of his volition, do not oust the district court’s jurisdiction once it has attached.24 This is well illustrated by Kirby N. American Soda Fountain Co., 194 U. S. 141, 146, where in a suit brought by Kirby he alleged that he was induced by the company’s false représentations to agréé to the exchange of his apparatus for one made by the défendant and to pay $2025 in addition. He prayed the cancellation of his obligation to pay the balance of $2025, damages of $2500, and general relief. The cause was removed to the circuit court. The company answered denying Kirby’s charges of fraud, relied upon a written agreement alleged to contain ail the terms of the contract, asserted full performance on its part, and that he had paid but $325 on his obligation to pay $2025. By cross-complaint, the company demanded $1700 and interest from Kirby and the establishment of a lien on the apparatus delivered to him. Kirby answered that he had voluntarily dismissed the original suit brought by him and that the cross-bill was not within the jurisdiction of the court because it did not claim in excess of $2,000, exclusive of interest and costs. The plea was overruled and judgment rendered on the cross-complaint. In affirming, the court referred to the amount demanded in Kirby’s original complaint and said: “The matter in dispute having thus been made to exceed the sum or value of two thousand dollars, exclusive of interest and costs, défendant presented his pétition and bond for removal, justified by the conviction that the défendant when it removed knew that the amount involved was too little to give jurisdiction: Turmine- v. West Jersey & S. R. Co., 44 F. (2d) 614; American Stores Co. v. Gerlach, 55 F. (2d) 658. 24 The same principle applies in cases where a fixed amount is requisite to jurisdiction on appeal. Lee v. Watson, 1 Wall. 337; Cooke v. United States, 2 Wall. 218. 294 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. and the cause was thereupon removed. The jurisdiction thus acquired by the Circuit Court was not divested by plaintiff’s subséquent action.” Fifty years earlier in Kanouse v. Martin, 15 How. 198, the court had held that voluntary réduction of the amount demanded below the sum necessary to give the circuit court jurisdiction could not defeat that jurisdiction once removal proceedings had been perfected. In reliance upon these precedents many cases, cited in Note 23, hâve been decided. We think this well established rule is supported by ample reason. If the plaintiff could, no matter how bona fide his original claim in the state court, reduce the amount of his demand to defeat fédéral jurisdiction the defendant’s supposed statutory right of removal would be subject to the plaintiff’s caprice. The claim, whether well or ill founded in fact, fixes the right of the défendant to remove, and the plaintiff ought not to be able to defeat that right and bring the cause back to the state court at his élection. If he does not desire to try his case in the fédéral court he may resort to the expédient of suing for less than the jurisdictional amount, and though he would be justly entitled to more, the défendant cannot remove.25 This view is further supported by the authorities as to causes in which jurisdiction dépends on diversity of citizenship. It uniformly has been held that in a suit properly begun in the fédéral court the change of citizenship of a party does not oust the jurisdiction.26 The same 25 Woods v. Massachusetts Protective Assn., 34 F. (2d) 501. And an amendment in the state court reducing the claim below the jurisdictional amount before removal is perfected is effective to invalidate removal and requires a remand of the cause: Maine v. Gilman, 11 Fed. 214; Waite v. Phoenix Ins. Co., supra; Harley v. Firemen’s Fund Ins. Co., 245 Fed. 471. 26 Morgan’s Heirs v. Morgan, 2 Wheat. 290, 297 ; Mullan v. Tor-rance, 9 Wheat. 537; Dunn v. Clarke, 8 Pet. 1; Clarke v. Mathew- ST. PAUL INDEMNITY CO. v. CAB CO. 295 283 Opinion of the Court. rule governs a suit originally brought in a state court and removed to a fédéral court.27 The decisions as to remand of a cause removed be-cause it involves a separable controversy are not incon-sistent with those concerning remand for lack of juris-dictional amount. In the case of a separable controversy, if, after removal, the plaintiff discontinues or dismisses as to the défendant who removed, so that there no longer exists any separable controversy, the cause must be re-manded.28 If a cause be removed on this ground the whole case, including the controversy between citizens of the same state, is taken over by the fédéral court only because one or more of the défendants is entitled to in-voke its jurisdiction. The basis of fédéral jurisdiction failing, it is proper that the remaining parties, who were involuntarily taken into the fédéral court, should, upon the cessation of the separable controversy which was the cause of their transmission to another tribunal, hâve their case returned to the state court. The présent case well illustrâtes the propriety of the rule that subséquent réduction of the amount claimed cannot oust the district court’s jurisdiction. Suit was in-stituted in the state court June 5, 1934. The lump sum claimed was largely in excess of $3,000, exclusive of interest and costs. The items which went to make up the respondent’s demand for indemnity were numerous and son, 12 Pet. 164; Tug River Coal & Sait Co. v. Brigel, 86 Fed. 818, affirming 73 Fed. 13. 27 Haracovic v. Standard Oil Co., 105 Fed. 785; Lébensbergèr v. Scofiéld, 139 Fed. 380. Change of parties by substitution or by intervention does not oust the jurisdiction: Phelps v. Oaks, 117 U. S. 236; Hardenbergh n. Ray, 151 U. S. 112; Wichita R. & Light Co. v. Public Utilities Comm’n, 260 U. S. 48. 28 Texas Transportation Co. v. Seéligson, 122 U. S. 519; Torrence v. Shedd, 144 U. S. 527 ; lowa Homestead Co. v. Des Moines N. & R. Co., 8 Fed. 97; Bane v. Keejer, 66 Fed. 610; Youtsey v. Hoffman, 108 Fed. 699; Cassidy v. Atlanta & C. A. L. Ry. Co., 109 Fed. 673; Sklarsky v. Great Atlantic & P. Tea. Co., YI F. (2d) 662. 296 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. each, in tum, was itself the total of several items of ex-penditure or liability. There is nothing to indicate that ail of the sums for which reimbursement was claimed had actually been expended prior to the beginning of suit or that the sums thereafter to be expended had been ascer-tained. Not until the second amended complaint was filed in the United States court, in November 1934, did the respondent furnish a statement of the particulars of its claim. That statement is not inconsistent with the making of a claim in good faith for over $3,000 when the suit was instituted. Nor is there evidence that the petitioner when it removed the cause knew, or had reason to believe, that the respondent’s claim, whether well or ill founded in law or fact, involved less than $3,000. On the face of the pleadings petitioner was entitled to invoke the jurisdiction of the fédéral court, and a réduction of the amount claimed, after removal, did not take away that privilège. The judgment is reversed and the cause is remanded to the Circuit Court of Appeals for further proceedings in conformity to this opinion. Reversed. Mr. Justice Cardozo and Mr. Justice Reed took no part in the considération or decision of this case. HELVERING v. BULLARD. 297 Statement of the Case. HELVERING, COMMISSIONER OF INTERNAL REVENUE, v. BULLARD, EXECUTOR. CERTIORARI TO THE CIRCUIT COURT OF APPEALS FOR THE SEVENTH CIRCUIT. No. 349. Argued February 1, 1938.—Decided February 28, 1938. 1. A decree in Illinois, entered by consent in compromise of litiga-tion, operated to abrogate a trust as violative of the rule against perpetuities and to establish the trustor’s absolute ownership of the assets. Held, that a new deed of trust made by the trustor pursuant to the compromise and conveying to some of the parties the same bénéficiai interests that they would hâve received under the original conveyance if valid, can not be related back to the création of the original trust, but must stand independently, for the purpose of determining the application of a fédéral tax provision enacted between the dates of the two conveyances. P. 300. 2. Sec. 302 (c) of the Rev. Act of 1926, as amended by Joint Resolution of March 3, 1931, requires the inclusion in a decedent’s gross taxable estate of property of which the decedent has at any time made a transfer, by trust or otherwise, under which the transferor retained for life the possession or enjoyment of the income from the property, except in case of a bona fide sale for an adéquate and full considération in money or money’s worth. Held: (1) That the exception did not apply where the transférée gave up nothing but an interest in an earlier transfer, which was adjudged void by a consent decree entered in pursuance of a compromise. P. 300. (2) The joint resolution is valid as to future non-testamentary transfers in the nature of gifts, since: (a) Congress may lay an excise on gifts at different rates for those which are and those which are not subject to réservation of a life estate; calling it*an estate tax doés not affect its validity. P. 301. (b) Congress may treat such transfers as testamentary to pre-vent avoidance of estate taxes. P. 301. 90 F. 2d 144, reversed. Certiorari, 302 U. S. 671, to review the reversai by the court below of a decision of the Board of Tax Appeals, 34 B. T. A. 243, upholding an estate tax. 298 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. Assistant Attorney General Morris, with whom Solicitor General Reed, and Messrs Sewall Key, Ellis N. Slack, and Arnold Raum were on the brief, for petitioner. Mr. Samuel S. Holmes, with whom Messrs. William D. Mitchell and Lorentz B. Knouff were on the brief, for respondent. By leave of Court, Mr. Herman Aaron filed a brief as amicus curiae, in support of respondent. Mr. Justice Roberts delivered the opinion of the Court. The petitioner challenges a decision holding unconsti-tutional the provision of § 302 (c) of the Revenue Act of 1926,1 as amended by Joint Resolution of Congress of March 3, 1931,2 which requires the inclusion in a de-cedent’s gross taxable estate of property transferred by irrevocable deed with réservation of a life estate. On ac-count of alleged conflict with our decisions and of the important constitutional question presented we granted the writ of certiorari. Clara R. Smith, a résident of Illinois, died in 1933. In 1927 she- transferred securities, by irrevocable deed, to her son Edward, in trust to pay the income to her for life and, upon her death, to divide the corpus into three equal parts, the income from a part to be paid to each of her three children, Lora, Bessie, and Edward, during their lives, with remainders of the daughters’ shares to their respective children; upon Edward’s death leaving no issue the income from his share to be paid to his widow for life and, upon her death, the remainder to be added, in equal shares, to the daughters’ trust funds. Edward died in 1928 leaving a widow but no issue. 1 c. 27, 44 Stat. 9, 70; U. S. C. Tit. 26, § 411 (c). 2 c. 454, 46 Stat. 1516; U. S. C. Tit. 26, § 411 (c). HELVERING v. BULLARD. 299 297 Opinion of the Court. In 1931 dissatisfaction with the administration of the trust impelled the decedent to seek its abrogation. Examination of the instrument disclosed violation of the rule against perpetuities. A bill was accordingly filed in an Illinois state court to hâve the trust declared void. The son’s widow answered denying invalidity. A guard-ian ad litem representing the interests of infant beneficiaries in remainder also opposed the prayer of the bill. Subsequently, to avoid family discord and amicably to settle the pending litigation, a compromise agreement was made by the decedent and ail the adult beneficiaries, consenting to the entry of a decree on condition that the decedent would déclaré a new trust of approximately one-third of the securities in the existing trust whereby Ed-ward’s widow should enjoy a life interest identical to that given her by the 1927 trust and, upon her death, the remainder should be equally divided between the decedent’s daughters. The agreement further required the making of testamentary provision for the decedent’s daughters and grandchildren, and certain outright gifts to the latter. In pursuance of the agreement, the decedent, on February 17, 1932, executed a new irrevocable deed of trust conveying approximately one-third of the corpus of the former trust and reserving to herself a life interest in the income, and executed a new will. A consent decree was then entered in the equity suit, the guardian ad litem representing to the court that the settlement would be advantageous to the minor beneficiaries. The Commissioner’s inclusion of the corpus of the trust of February 17, 1932, in the gross estate was sus-tained by the Board of Tax Appeals.3 The Circuit Court of Appeals reversed the Board’s decision.4 We are of opinion that the action of the Commissioner and the Board should hâve been affirmed. 3 34 B. T. A. 243. 4 90 F. (2d) 144. 300 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. First. Both the Board and the Court held that the decree of the state court, notwithstanding its entry pur-suant to stipulation, adjudicated the rights of the parties, abrogated the trust of 1927, and established the dece-dent’s absolute ownership of the assets. This conclusion is fully supported by decisions of the Suprême Court of Illinois and we accept it. It follows that the respondent’s contention that the transfer of 1932 has no independent existence and that, in legal effect, the trust for the son’s widow stems from the deed of 1927, must be overruled. Second. The trust of 1932 was created after the adoption of the Joint Resolution of March 3, 1931, which re-quired inclusion in the gross estate of the value at the date of death of ail property to the extent of any interest therein of which a decedent has at any time made a transfer by trust or otherwise under which the transférer retained for life the possession or enjoyment of the income from the property, except in case of a bona fide sale for an adéquate and full considération in money or money’s worth. It is urged that the settlement of the dispute as to the invalidity of the trust deed of 1927, conditioned, as it was, upon the making of the new trust, constitutes such a bona fide sale, for adéquate considération, as to bring the trust of 1932 within the exception. The argument is that the decree setting aside the 1927 trust merely gave judicial sanction to the compromise agreement and that the contract was for an adéquate and valuable considération and would, therefore, hâve been enforced by a court of equity at the instance of any of the parties to it. While recognizing that a decree thus begotten has the same force and effect as a decree in invitum, the respondent seeks to go behind the decree and spell out a sale by Edward’s widow of her interest under the 1927 trust for the interest conferred upon her by the 1932 trust. The court below has held the position untenable and we 297 HELVERING v. BULLARD. Opinion of the Court. 301 agréé. The decree declared the 1927 trust void and re-vested the trust assets in the decedent. If that trust was, as the Illinois court decreed, void and ineffective because it violated the rule against perpetuities the son’s widow took no interest under it and gave nothing to procure the 1932 transfer. Third. The Commissioner relies not only upon the Joint Resolution of March 3, 1931, but upon § 803 (a) of the Revenue Act of 1932.5 We need not consider the latter since the Joint Resolution, if legally enforcible, in express terms authorized his inclusion of the trust fund in the decedent’s gross estate. As the Resolution was adopted nearly a year prior to the création of the 1932 trust no claim is or can be made that, as to that transaction, it is rétroactive. The contention is that the transfer was inter vivos, was presently effective, was irrevocable, was not made in contemplation of, or effective at, death, and that Congress was, therefore, without power to make it the subject of an estate or inheritance tax; that, while the transfer might, by appropriate législation, hâve been taxed as a gift, to tax it as in the nature of a testamentary disposition is a déniai of due process. The contention is unsound for several reasons. Since Congress may lay an excise upon gifts it is of no signifi-cance that the exaction is denominated an estate tax or is found in a statute purporting to levy an estate tax. Moreover, Congress having the right to classify gifts of different sorts might impose an excise at one rate upon a gift without réservation of a life estate and at another rate upon a gift with such réservation. Such a classification would not be arbitrary or unreasonable. A further vindication of the exaction is the authority of Congress to treat as testamentary, transfers with réservation of a 5 c. 209, 47 Stat. 169, 279; U. S. C. Tit. 26, § 411 (c). 302 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. power or an interest in the donor. The legislative his-tory of the Joint Resolution, to which reference is made in Hassett v. Welch, post, p. 303, demonstrates that the purpose of the législation was to prevent avoidance of estate taxes. As has been said by the Court of Appeals of New York:6 “It is true that an ingenious mind may devise other means of avoiding an inheritance tax, but the one commonly used is a transfer with réservation of a life estate.” We hâve recently sustained the prospective operation of a provision including in the gross estate property which a decedent has transferred retaining power alone, or in conjunction with any other person, to alter, amend, or revoke.7 We held the purpose of the clause was to prevent avoidance of tax and the measure was reasonably calculated to that end. As applied to a trust created after its enactment the Joint Resolution does not violate the Fifth Amendment. The judgment is reversed and the cause is remanded for further proceedings in conformity with this opinion. Reversed. Mr. Justice Cardozo and Mr. Justice Reed took no part in the considération or decision of this case. a In the Matter of Keeney, 194 N. Y. 281, 287; 87 N. E. 428; afiirmed 222 U. S. 525. J Helvering v. City Bank Farmers T. Co., 296 U. S. 85, 90. Compare Müliken v. United States, 283 U. S. 15; Tyler v. United States, 281 U. S. 497. HASSETT v. WELCH. Syllabus. 303 HASSETT, FORMER ACTING COLLECTOR, v. WELCH et al, EXECUTORS.* CERTIORARI TO THE CIRCUIT COURT OF APPEALS FOR THE FIRST CIRCUIT. No. 375. Argued February 1, 1938.—Decided February 28, 1938. 1. Sec. 302 (c) of the Rev. Act of 1926, which required that there be included in a decedent’s estate, for estate tax purposes, any property interest of which the decedent has “at any time” made a transfer in contemplation of or intended to take effect in possession or enjoyment at or after death, was amended by the Joint Resolution of March 3, 1931, to include “a transfer under which the transférer has retained for his life . . . the possession or enjoyment of, or the income from, the property.” Section 803 (a) of the Rev. Act of June 6, 1932, substantially reënacts this provision. Reld: (1) That the added provision does not apply to transfers made before, by decedents who died after, the enaetment of the Joint Resolution. P. 307. (2) This construction is confirmed (a) by the legislative history and administrative interprétation of the Joint Resolution; (b) by its reënactment in the light of that interprétation. P. 309. 2. Section 302 (h) of the Rev. Act of 1926, provided “Except as otherwise specifically provided therein subdivisions (b), (c), (d), (e), (f), and (g) of this section shall apply to the transfers, trusts, estâtes, interests, rights, powers, and relinquishment of powers, as severally enumerated and described therein, whether made, created, arising, existing, exercised, or relinquished before or after the enaetment of this Act.” Subdivision (c) dealt with trânsfers in contemplation of, or intended to take effect in possession or enjoyment at or after, death. The Joint Resolution of 1931, supra, amended § 302 (c) to include non-testamentary * Together with No. 484, Helvering, Commissioner of Internai Revenue, v. Marshall, Administrator. On writ of certiorari to the Circuit Court of Appeals for the Second Circuit. 304 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. transfers with réservation of life estate to transférer. Held that § 302 (h) does not make the amendment apply retroactively to the kind of transfers thereby added. P. 313. 3. An adoption by one section of a statute of the particular provisions of another section by spécifie and descriptive reference does not embrace other particulars added later by amendment to the section so referred to. P. 314. 4. In the absence of clear expression to the contrary, a law is pre-sumed to operate prospectively. Id. 5. If doubt exists as to the construction of a taxing statute, the doubt should be resolved in favor of the taxpayer. Id. 90 F. 2d 833 ; 91 F. 2d 1010, affirmed. Certiorari, 302 U. S. 674, 677, to review two decisions of Circuit Courts of Appeals against estate tax assess-ments. In No. 375, the taxpayers appealed from a judgment of the District Court for the Collecter, 15 F. Supp. 692. In No. 484, there was an appeal by the Commissioner from the adverse decision of the Board of Tax Appeals. Assistant Attorney General Morris, with whom Soliciter General Reed, and Messrs. Sewall Key and Arnold Raum were on the briefs, for petitioners. Mr. William D. Mitchell, with whom MessrS. James Lenox Banks, Jr., and George H. Craven were on the brief, for respondent in No. 484. Messrs. John L. Hall and Claude R. Branch, with whom Messrs. Henry Hixon Meyer and Edward C. Thayer “were on the brief, for respondents in No. 375. Mr. Justice Roberts delivered the opinion of the Court. The petitioners ask us to hold that § 302 (c) of the Revenue Act of 19261 as amended by the Joint Resolution of Congress of March 3, 1931,2 and § 803 (a) of the 1 c. 27, 44 Stat. 9, 70; U. S. C. Tit. 26, § 411 (c). 2 c. 454, 46 Stat. 1516; U. S. C. Tit. 26, § 411 (c). 303 HASSETT v. WELCH. Opinion of the Court. 305 Revenue Act of 1932,3 includes in the gross estate of a decedent, for estate tax, property which, before the adoption of the amendments, was irrevocably transferred with réservation of a life estate to the transférer; and that, so applied, the statute does not offend the due process clause of the Fifth Amendment of the Constitution. The nu-merous cases pending in the courts and the Board of Tax Appeals involving these questions, and the claim that decisions of this court hâve not settled the matter, moved us to grant certiorari. The respondents in No. 375 are executors under the will of a decedent who died November 20, 1932. On February 13, 1924, voluntarily and without valuable considération, he transferred to a trustée property which he expected to receive under the will of his brother, reserv-ing to himself the income for life, directing division of the income after his death between nephews and nieces and distribution of the corpus, upon the death of the sur-vivor of them, amongst their then living issue. After his brother’s death, and on October 22, 1926, he duly rati-fied and confirmed the original trust instrument. The Commissioner ruled that the value of the trust assets should be included in the decedent’s gross estate, in the view that the transfer was testamentary, because made in contemplation of death, or intended to take effect in possession or enjoyment at or after death, within the meaning of § 302 (c) of the Revenue Act of 1926. The respondents paid the resulting tax and sued for refund in the District Court of Massachusetts. Judgment went for the Collector.4 The Circuit Court of Appeals held that the District Court erred in concluding that the transfer was made in contemplation of death or was intended to take effect in possession or enjoyment after death. The petitioner nevertheless insisted upon the legality of the 3 c. 209, 47 Stat. 169, 279; U. S. C. Tit. 26, § 411 (c). 4 15 F. Supp. 692. 53383°—38---------20 306 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. exaction as the decedent died after the 1931 and 1932 amendments of § 302 (c), which declared the property transferred a part of the gross estate for computation of estate tax, in virtue of the réservation to the transférer of the income for his life. The court overruled the contention, holding that, if so retroactively enforced, the législation violated the Fifth Amendment of the Constitution, and reversed the judgment.5 In his application for certiorari the petitioner did not assign errer to the Circuit Court’s ruling as to the nontestamentary character of the transfer but confined his attack to the decision that the amendments of § 302 (c) could not constitutionally be invoked to sustain the tax. In No. 484 it appears that the decedent died intestate June 4, 1933. The respondent, her son, is her adminis-trator. November 15, 1920, she transferred to him certain cash and securities. On the same day they entered into an agreement reciting an understanding that, in case of his death during her life, the securities and cash should be reconveyed to her and, in the meantime, he should pay her such portions of the income therefrom as she might from time to time request in writing; that while he held the securities he might invest and reinvest; that he should bequeath her ail the assets constituting the fund, in case she survived him; that she would re-imburse him for any increased income taxes payable by him in virtue of his ownership of the fund and that, if she should survive him and take the property under his will, she would reimburse his estate for state and fédéral inheritance taxes due by reason of the bequest. The agreement contained other provisions for the safeguard-ing and separate custody of the fund during the mother’s life. The respondent paid the decedent portions of the income upon her request. He executed a will bequeath- 6 90 F. (2d) 833. HASSETT v. WELCH. 307 303 Opinion of the Court. ing the property to her on the ternis mentioned in the agreement, but upon her death, he revoked the bequest. The Commissioner included the value of the fund in the decedent’s gross estate, holding that she had made a transfer within the terms of § 302 (c) of the Revenue Act of 1926, as amended in 1931 and 1932. The Board of Tax Appeals reversed the Commissioner’s détermination and the Court of Appeals affirmed its action 6 upon the authority of the decision of the Circuit Court of Appeals of the First Circuit in No. 375 and that of the Seventh Circuit in Helvering v. Bullard, ante, p. 297. Counsel for the Government argue that the Joint Resolution of 1931 and § 803 (a) of the Revenue Act of 1932 were intended to impose an estate tax measured by transfers of the sort therein described which had been irrev-ocably made prior to the passage of the législation and that, so construed, they are not arbitrarily or unreason-ably rétroactive and do not offend the due process clause of the Fifth Amendment. Counsel for respondents answer that the enactments were intended to operate only upon transfers subsequently consummated and, if construed to reach the past transfers here involved, violaie the amendment. We hold that the statutes are prospective in their operation and do not impose a tax in respect of past irrevocable transfers with réservation of a life interest. Ascertainment of the intended application of the Joint Resolution of March 3, 1931, and § 803 (a) of the Revenue Act of 1932, in volves a reading of them in the light of cases construing similar phraseology of earlier acts, their legislative history and administrative interprétation. There is agreement that § 803 (a) reënacted the substance of the Joint Resolution with but slight verbal différences. It will, therefore, be necessary to quote only 6 91 F. (2d) 1010. 308 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. the Resolution. By it § 302 (c) of the Revenue Act of 1926, supra, was amended to provide: “The value of the gross estate of the decedent shall be determined by including the value at the time of his death of ail property, real or personal, tangible or intangible, wherever situated— “(c) To the extent of any interest therein of which the decedent has at any time made a transfer, by trust or otherwise, in contemplation of or intended to take effect in possession or enjoyment at or after his death, including a transfer under which the transférer has re-tained for his life or any period not ending before his death (1) the possession or enjoyment of, or the income from, the property or (2) the right to designate the per-sons who shall possess or enjoy the property or the income therefrom; except in case of a bona fide sale for an adéquate and full considération in money or money’s worth.” The mat ter in ordinary type is § 302 (c) as it was prior to amendment ; the additions are in italics. The Government relies on the words “at any time” as demonstrating that the législation was intended to apply to transfers made before its adoption and is so unequiv-ocal as to leave no room for construction. This phrase, appearing in an earlier revenue act, had, however, been held not to render the statute effective upon transfers antedating the passage of the Act7 and Congress ap-parently realized that the expression did not carry the statute back so as to embrace transactions consummated before its passage; for, in subsection (h) of § 302 of the Act of 1926,8 in referring to transactions and interests 7 Shwdb v. Doyle, 258 U. S. 529; Union Trust Co. v. Wardell, 258 U. S. 537; construing § 202 of the Àct of Sept. 8, 1916, 39 Stat. 777. 844 Stat. 71, U. S. C. Tit. 26, § 411 (h). 303 HASSETT v. WELCH. Opinion of the Court. 309 giving rise to a tax by virtue of preceding subsections, it directed that they should be taxable “whether made, cre-ated, arising, existing, exercised, or relinquished before or after the enactment 0/ this Act.”9 We conclude that the meaning of the section is not so free from doubt as to preclude inquiry concerning the legislative purpose. The history of the Resolution is of material aid in its construction. Section 302 (c) of the Act of 1926, like earlier acts, measured the tax by the inclusion in the gross estate of property of which the decedent had made a voluntary transfer in contemplation of, or intended to take effect in possession or enjoyment at or after his death. Notwithstanding the Treasury had ruled that a transfer of assets with a réservation of income for the donor’s life came within the définition this court held otherwise.10 Dissatisfied with the decision, the Government sought a reversai of it but, in three judgments, an-nounced on March 2, 1931, the ruling was reaffirmed.11 In the opinions in these cases, which led to the préparation and adoption of the Resolution, the court said there was “no question of the constitutional authority of the Congress to impose prospectively a tax with respect to transfers or trusts of the sort here involved . . There then remained one day of the current session of Congress. The Treasury drafted an amendment of § 302 (c) to bring trusts of this type within its sweep, in the form of the Joint Resolution of March 3, 1931, which was sent to Congress on the day of our decisions and was passed, 9 Compare Shwab v. Doyle, supra, at p. 536; Lewéllyn v. Frick, 268 U. S. 238, 252. 10 May v. Heiner, 281 U. S. 238, construing § 402 (c) of the Revenue Act of 1918, 40 Stat. 1057, 1097. 11 Burnet v. Northern Trust Co., 283 U. S. 782; Morsman v. Bur-net, 283 U. S. 783; McCormick v. Burnet, 283 U. S. 784, construing § 402 (c) of the Revenue Act of 1921 and § 302 (c) of the Revenue Act of 1924. 310 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. under a suspension of the rules, on the next day, the last of the session.12 Because its passage was considered exigent the Resolution was adopted without having been printed and in reliance on statements made from the floor. The Con-gressional Record discloses the understanding of the Con-gress with respect to its scope. Mr. Garner, of the House Ways and Means Committee, stated: “The Committee on Ways and Means this afternoon had a meeting and unanimously reported the resolution just passed. We did not make it rétroactive for the reason that we were afraid that the Senate would not agréé to it.” 13 Mr. Hawley, of the same Committee, in charge of the Resolution, stated, in answer to a question: “It provides that hereafter no such method shall be used to évadé the tax” and, referring to the situation created by the decisions of this court, he said: “It is entirely apparent that if this situation is per-mitted to continue, the Fédéral estate tax will be seri-ously affected. Entirely apart from the refunds that may be expected to resuit, it is to be anticipated that many persons will proceed to execute trusts or other varieties of transfers under which they will be enabled to escape the estate tax upon their property. It is of the greatest importance therefore that this situation be corrected and that this obvious opportunity for tax avoidance be removed. It is for that purpose that the joint resolution is proposed.” This language, we think, scarcely bears the interprétation put upon it by Government counsel,—that the tax was meant to be laid on estâtes of ail who died after the adoption of the Resolution. Bearing in mind that the Resolution was prepared and its passage recommended by the Treasury, the adminis- 12 Cong. Rec., 71st Cong., 3rd Sess., Vol. 74, Part 7, p. 7198. 13 Cong. Rec., 71st Cong., 3rd Sess., Vol. 74, Part 7, pp. 7198-7199. HASSETT v. WELCH. 311 303 Opinion of the Court. trative interprétation supports in uncommon measure the view that it was not intended to operate upon transfers completed prior to its passage. Promptly upon its passage the Department issued T. D. 4314,14 approved by the Secretary of the Treasury May 22, 1931, which was in the form of a letter to collectors of internai revenue and others concemed. It quoted the language of the resolution and stated: “In view of the decisions of the Suprême Court of the United States in Nichols v. Coolidge, (274 U. S., 531 [T. D. 4072, C. B. VI-2, 351]), May v, Heiner, (281 U. S., 238 [Ct. D. 186, C. B. IX-1, 382]), Coolidge v. Long, (282 U. S., 582), Burnet v. Northern Trust Co. (51 S. Ct., 342), Edgar M. Morsman, jr., v. Burnet, (51 S. Ct., 343) and Cyrus H. McCormick v. Burnet (51 S. Ct., 343), the portion added by the amendment to section 302 (c) of the Revenue Act of 1926, as set forth above in italic, will, notwithstanding the provisions of section 302 (h) of that Act, be applied prospectively only; i. e., to such transfers coming within the amendment as were made after 10.30 p. m., Washington, D. C., time, March 3, 1931. “Régulations 70, 1929 édition, will be amended to make the changes necessitated by the amendment to section 302 (c) of the Revenue Act of 1926 and the above decisions of the Suprême Court.” (Italics in the original.) April 11, 1932, Régulations 70 were amended by T. D. 4336 and, in part, read: “Art. 18. Rétention of possession, enjoyment, or, income.—Any transfer which was made by the decedent after 10.30 p. m., Washington, D. C., time, March 3, 1931, and under which he retained for his life or any period not ending before his death (1) the possession , or enjoyment of, or the income from, the property or (2) the 14 C. B. X-l, 450. 312 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. right to designate the persons who shall possess or enjoy the property or the income therefrom, is taxable, provided such transfer was not a bona fide sale for an adéquate and full considération in money or money’s worth.” Not only is the legislative history of § 803 (a) of the Act of 1932 bare of indication of any purpose that it should affect past transfers, but what appears tends to disprove any such thought.15 Moreover, the reënactment of the Resolution of 1931 in the light of the administrative rulings requires the conclusion that Congress ap-proved and adopted the administrative construction of the provision it reënacted.16 Régulations 80, approved November 7, 1934, after par-aphrasing § 803 (a), concluded: “The provisions of this subdivision do not apply (1) if the transfer was made prior to 10.30 p. m., eastern standard time, March 3, 1931, and (2) if the decedent died prior to 5 p. m. eastern standard time, June 6, 1932 [The date of passage of the Revenue Act of 1932]. See section 506 of the Revenue Act of 1934.” This régulation was retained as Article 18 in the 1937 édition of Régulations 80 issued October 26, 15 The reports of the Committees of both House and Senate con-tain this statement: “The purpose of this amendment to section 302 (c) of the revenue act of 1926 is to clarify in certain respects the ^mendments made to that section by the joint resolution of March 3, 1931, which were adopted to render taxable a transfer under which the decedent reserved the income for his life. The joint resolution was designed to avoid the effect of decisions of the Suprême Court holding such a transfer not taxable if irrevocable and not made in contemplation of death. Certain new matter has also been added, which is without rétroactive effect” (House Committee Report No. 708, 72nd Cong., Ist Sess.; Senate Committee Report No. 665, same session). 16 Brewster v. Gage, 280 U. S. 327, 337 ; United States v. Dakota-Montana OU Co., 288 U. S. 459, 466; McFeely v. Commissioner, 296 U. S. 102, 108; United States v. Safety Car Heating & L. Co., 297 U. S. 88, 95. HASSETT v. WELCH. 313 303 Opinion of the Court. 1937. Thus while the régulations hâve been altered to treat § 803 (a) of the 1932 Act as retroactively affecting transfers made after March 3, 1931, the Department has consistently ruled that the Resolution of 1931 has no application to transfers made prior to its adoption. The position thus recently taken is inconsistent in its treat-ment of the two like enactments and is diflicult to under-stand in view of the consistent interprétation of the Joint Resolution but it fails to weaken the force of that consistent interprétation with knowledge of which Congress reënacted the same provision in 1932. The Government urges that ail of these circumstances which are persuasive that the enactments were intended to operate for the future are overborne by § 302 (h) of the Revenue Act of 1926, which is: “Except as otherwise specifically provided therein subdivisions (b), (c), (d), (e), (f), and (g) of this section shall apply to the transfers, trusts, estâtes, interests, rights, powers, and relinquishment of powers, as severally enumerated and described therein, whether made, created, arising, existing, exercised, or relinquished before or after the enactment of this Act.” (Italics supplied.) It will be remembered that the Joint Resolution of 1931 amended § 302 (c) of the Act of 1926 to cover transfers such as are here involved. It made no reference to any other portion of that Act. Since § 302 (c) in its original form was, by § 302 (h), made applicable to transfers whether made before or after the Act of 1926, the contention is that it has like operation and effect as respects the provision added to it by the amendment. And the same argument is advanced with respect to the amendment of subsection (c) by the Act of 1932. Resort is had to canons of constructions as an aid in ascertaining the intent of the législature. It may occur that the intent is so clear that no such resort should be indulged, and the Government claims this is such a case. 314 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. The matter is, we think, involved in sufficient ambiguity to warrant our seeking such aid. A well-settled canon tends to support the position of respondents: “Where one statute adopts the particular provisions of another by a spécifie and descriptive reference to the statute or provisions adopted, the effect is the same as though the statute or provisions adopted had been incorporated bodily into the adopting statute . . . Such adoption takes the statute as it exists at the time of adoption and does not in-clude subséquent additions or modifications of the statute so taken unless it does so by express intent.”17 The weight of authority holds this rule respecting two separate acts applicable where, as here, one section of a statute refers to another section which alone is amended.18 In view of other settled rules of statutory construction, which teach that a law is presumed, in the absence of clear expression to the contrary, to operate prospec-tively;19 that, if doubt exists as to the construction of a taxing statute, the doubt should be resolved in favor of the taxpayer,20 we feel bound to hold that the Joint Resolution of 1931 and § 803 (a) of the Act of 1932 apply only to transfers with réservation of life income made subséquent to the dates of their adoption respectively. 17 Lewis’ Sutherland on Statutory Construction, 2d ed., Vol. II, pp. 787-8. 18 Calumet Foundry & M. Co. v. Mroz, 79 Ind. App. 305; 137 N. E. 627; State v. Beckner, 197 lowa 1252; 198 N. W. 643; Crohn v. Téléphoné Co., 131 Mo. App. 313; 109 S. W. 1068; Gustafson v. Hammond Irrigation Dist., 87 Mont. 217; 287 Pac. 640; Flanders v. Town of Merrimack, 48 Wis. 567; 4 N. W. 741; contra, American Bank v. Goss, 236 N. Y. 488, 142 N. E. 156. 19 United States v. Heth, 3 Cranch 399, 413; Reynolds v. M’Arthur, 2 Pet. 417, 434; Shwab v. Doyle, 258 U. S. 529; United States v. Magnolia Petroleum Co., 276 U. S. 160, 162. 20 Govld v. Govld, 245 U. S. 151; Shwab v. Doyle, supra; Reinecke v. Northern Trust Co., 278 U. S. 339, 348; White v. Aronson, 302 U. S. 16. 303 ESCANABA & L. S. R. CO. v. U. S. Syllabus. 315 Holding this view, we need not consider the contention that the statutes as applied to the transfers under considération deprive the respondents of their property without due process in violation of the Fifth Amendment. The judgments are Affirmed. Mr. Justice Cardozo and Mr. Justice Reed took no part in the considération or decision of these cases. ESCANABA & LAKE SUPERIOR RAILROAD CO. v. UNITED STATES et al. APPEAL FROM THE DISTRICT COURT OF THE UNITED STATES FOR THE WESTERN DISTRICT OF MICHIGAN. No. 415. Argued February 4, 7, 1938.—Decided February 28, 1938. 1. Whether the Interstate Commerce Commission should approve a pooling agreement between competing carriers, under § 5 (1) of the Interstate Commerce Act, is a question of public interest and welfare. Other carriers, as well as shippers and other persons, are entitled to be heard on this question; but a carrier which is not a party to the agreement is not a “carrier involved,” within the meaning of the section, even if adversely affected by it, and may not frustrate the agreement by withholding its assent. P. 319. 2. The ‘M’ railroad carried iron ore from the mines to a lake port, part of the way over its own line and thence to the port over the line of ‘E’ railroad under a trackage agreement. The ‘N’ railroad carried such ore from the mines to the port over its own line. Both ‘N’ and ‘M’ interchanged other freight with ‘E’ at their respective connections with that line. To effect économies, ‘M’ and ‘N’ applied for and obtained from the Interstate Commerce Commission, under § 5 (1) of the Interstate Commerce Act, an order sanctioning an agreement between them under which ore consigned over either would be routed over ‘N’, and the ore business be pooled between them; and under which ‘M’ and ‘N’ were also to pool their receipts from other traffic interchanged by 316 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. either of them with ‘E’. Held that ‘E’ was not a “carrier involved” in the pooling agreement, within the meaning of the section above mentioned, and that its assent was not necessary to the Com-mission’s approval. Pp. 317-322. ‘E’ was not a carrier of the ore hauled by ‘M’ under the trackage agreement; it received no part of the freight paid; issued no bills-of-lading, and maintained no tariff for that transportation. It neither held itself out to serve in that respect nor rendered any service to shippers of ore; and, as respects the pro-posed pooling of freights on the other interchanged traffic, it was not a carrier involved in the service rendered up to the exchange points. 21 F. Supp. 151, affirmed. Appeal from a decree dismissing a bill to set aside an order of the Interstate Commerce Commission. Mr. John S. Burchmore, with whom Mr. Clark M. Robertson was on the brief, for appellant. Mr. J. Stanley Payne, with whom Acting Solicitor General Bell, Assistant Attorney General Jackson, and Messrs. Elmer B. Collins and Daniel W. Knowlton were on the brief, for the United States and the Interstate Commerce Commission. Mr. C. R. Sutherland, with whom Mr. O. W. Dynes was on the brief, for Scandrett et al., intervening défendants. Mr. Justice Roberts delivered the opinion of the Court. This is an appeal from the judgment of a specially con-stituted District Court1 dismissing the appellant’s bill which prayed relief against an order of the Interstate Commerce Commission approving and authorizing a pro-posed pooling agreement between two other railroads.2 121 F. Supp. 151. 2 210 I. C. C. 599; 219 I. C. C. 285. ESCANABA & L. S. R. CO. v. U. S. 317 315 Opinion of the Court. The single question presented is whether the appellant is a “carrier involved” within the meaning of § 5 (1) of the Interstate Commerce Act.3 The appellant, hereinafter sometimes called “Escanaba,” is a Michigan corporation operating a railroad which does business in intrastate and interstate commerce. Its line extends from Escanaba, Michigan, a port on Lake Michigan, northwesterly some sixty-three miles to Channing, which is on the northern border of the Menominee ore district. This district was reached in 1900, and still is served, by the lines of the Chicago and Northwestern Railroad Company (herein denominated “Northwestern”) extending from the mines in a general southeasterly direction to the Northwestern’s ore docks at Escanaba. The Chicago, Milwaukee, St. Paul and Pacific Railroad Company (herein called “Milwaukee”) had in and prior to 1900 a line reaching the Menominee district but the ore shipped over this line went south to a connection with the Soo Line and thence eastward to a destination other than Escanaba. Milwaukee and Escanaba entered into an agreement in 1900 whereby the former was to hâve trackage rights for its trains of iron ore from Channing to Escanaba, where the Milwaukee constructed its own ore docks for the lading of ore into lake steamers, and trackage rights for the return of its empty cars from Escanaba to Channing. On the footing of this contract Escanaba made a large investment in roadway suitable for the accommodation of Milwaukee’s trains. The details of the agreement are unimportant. It will suffice to say that Milwaukee had no right to carry pas-sengers or freight, including ore, to intermediate points on the line of Escanaba; had no schedules for its ore 3 Act of Feb. 4, 1887, c. 104, 24 Stat. 380, as amended by Transportation Act of Feb. 28,1920, c. 91, § 407,41 Stat. 480, U. S. C. Tit. 49, § 5 (1). 318 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. trains; operated them by its own personnel and power, subject, however, to the control of the line by Escanaba’s dispatchers and signal men. Milwaukee was to pay for the privilège a certain wheelage charge which, in no event, was to be less than $27,000 a year whether the total wheelage amounted to that sum or not; and was to pay certain other amounts towards the maintenance of Escanaba’s line. A renewal of this agreement is now in force and will so remain until January 1, 1951. Milwaukee’s docks at Escanaba hâve fallen into disrepair. To avoid the large expenditure required to restore them, and to retain a share of the ore transportation, Milwaukee negotiated a pooling agreement with Northwestern under the terms of which ore consigned over either line from the mines to Escanaba will be routed over Northwestern’s line and use Northwestern’s docks at Escanaba and the ore business of both lines will be pooled on an agreed basis. Inasmuch as certain freight other than iron ore has been interchanged by Milwaukee with Escanaba at Channing and by Northwestern with Escanaba at Escanaba, and, as it is believed the ore pooling arrangement and discontinuance of Milwaukee’s ore haulage over Escanaba’s tracks may cause Escanaba to abandon the western end of its line, thus preventing the interchange of Milwaukee and Escanaba at Channing, it is further agreed that Milwaukee and Northwestern shall pool the receipts from interchange trahie exchanged by either of them with Escanaba, to recompense Milwaukee for possible loss of business resulting from the ore trahie pool. The two railroads, parties to the pooling agreement, submitted it to the Interstate Commerce Commission for approval.4 That body held that the proposed discontinuance of operation by Milwaukee over Escanaba’s line under the trackage agreement 4 They were represented before the Commission by their respective trustées appointed under § 77 of the Bankruptcy Act. 315 ESCANABA & L. S. R. CO. v. U. S. Opinion of the Court. 319 amounted to an abandonment as defined by § 1 (18) of the Interstate Commerce Act5 and, without the Commission’s approval of the abandonment, the pooling agree-ment could not become effective. The Commission, therefore, refused to pass upon it. Thereupon the parties resubmitted the pooling agreement together with a con-ditional application by Milwaukee for abandonment of its ore haulage over Escanaba. Escanaba intervened in the proceeding, and resisted the issue of an order of approval. A hearing was had at which not only Escanaba but many shippers and communities on its line presented evidence. The Commission made the findings required by §§ 1 (18) and 5 (1) of the Act, particularly that the proposed pooling arrangement and abandonment of the line by Milwaukee would promote the public interest and convenience and issued orders authorizing the proposed arrangement. Escanaba has abandoned the contention made in the District Court, and there overruled, that the Commission’s findings are not supported by any evidence, and here attacks only the alleged error of law of the Commission and the court below in holding that it is not a “party involved” in the pooling agreement within the meaning of § 5 (1), whose assent is necessary to the approval of the Commisison. Section 5 (1) of the original Interstate Commerce Act in sweeping terms forbade ail pooling of freights of different and competing railroads and ail agreements for division of aggregate or net proceeds of their eamings or any portion thereof. The Transportation Act, 1920, qualified this prohibition by excepting such arrangements as should hâve the spécifie approval of the Commission, and that approval was thus conditioned: “That whenever the Commission is of opinion, after hearing upon application of any carrier or carriers engaged in the transportation of passengers or property sub- 5 U. S. C. Tit. 49, § 1 (18). 320 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. ject to this Act, or upon its own initiative, that the division of their trahie or eamings, to the extent indicated by the Commission, will be in the interest of better service to the public, or economy in operation, and will not unduly restrain compétition, the Commission shall hâve authority by order to approve and authorize, ij assented to by ail the carriers involved, such division of trahie or eamings, under such rules and régulations, and for such considération as between such carriers and upon such terms and conditions, as shall be found by the Commission to be just and reasonable in the premises.” (Italics supplied.) The controversy revolves around the meaning of the phrase “if assented to by ail the carriers involved.” Es-canaba insists that it is a carrier involved in the proposed agreement, and its assent is necessary to an affirmative order of the Commission. The appellees deny that it is such and the Commission and the District Court hâve held with them. We are of opinion that the decree of the District Court was right and must be affirmed. First. The amendment of § 5 (1) of the original statute by the Transportation Act, 1920, was one of the alterations made in the Act as a resuit of expérience gained from unified operation of the railroads under fédéral con-trol. The strict sanctions of the original Act, intended to preserve compétition between carriers, were, in a number of instances, relaxed. Mergers and consolidations were authorized, pooling arrangements were to be permitted, extensions and abandonments were made lawful and divisions of joint through rates might be adjusted, ail for the sake of economy and efficiency and the prévention of destructive compétitive practices, and ail subject to the supervision and control of the Interstate Commerce Commission, and its finding that the action proposed or ordered would be in the public interest. These amend-ments are to be given liberal construction in aid of the purposes Congress had in mind. Under the new provi- 315 ESCANABA & L. S. R. CO. v. U. S. Opinion of the Court. 321 sions, Milwaukee and Northwestern might hâve merged or Consolidated if the Commission found such a procedure would be in the public interest. Similar considérations would justify their proposed pooling of freight transportation. Shippers over Escanaba’s lines, communities served by it, and, indeed, shippers in communities on distant lines and persons having no other interest than that of the general public welfare, were entitled to be heard before the Commission and to présent whatever proofs might tend to show that the proposed agreement would or would not be for the public welfare. They, however, are not “carriers involved,” mentioned in § 5 (1). Escanaba had the undoubted right accorded it to appear and to be heard on the question of the public interest and welfare and indeed so had every carrier having connections with Milwaukee and Northwestern. The question involved in the appellant’s contention is whether it or any other carrier, not actually a party to the pooling agreement, is a “carrier involved” within the meaning of the Act, so that it may frustrate the agreement by withholding its assent. Second. Escanaba is not a carrier of the ore which is hauled between Channing and Escanaba under the track-age agreement. It receives no part of the freight paid, it issues no bills of lading, it maintains no tariffs covering that transportation. It neither holds itself out to serve in that respect nor renders any service to shippers of ore; and, as respects the proposed pooling of freights on Milwaukee’s traffic, exchanged with it at Channing, and Northwestern’s traffic, exchanged with it at Escanaba, is not a carrier involved in the service rendered up to the exchange points, which is to be pooled. But it is said that the word “involved” connotes something more than a party to an agreement; that it embraces any railroad affected by the arrangement. And, it is urged, Escanaba will be seriously injured by the proposed arrangement, in 53383°—38--------21 322 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. spite of the continuing obligation of Milwaukee to pay it a minimum of $27,000 per annum until 1951. If a carrier not a party, but adversely affected, is “involved” in the sense of § 5 (1) Escanaba’s assent is a condition precedent to authorization by the Commission. We must then détermine the meaning of the phrase as used in the statute. Aid is afforded by the context. The section gives the Commission authority to approve and authorize, “if assented to by ail the carriers involved, . . . under such rules and régulations, and for such considération as between such carriers and upon such terms and conditions,” as the Commission shall find just and reason-able. This reference to the mutual considérations to be exchanged by “such carriers” shows that Congress meant by the phrase “ail the carriers involved,” those, and those only, who are parties to the pooling of freights and the division of the proceeds. Escanaba, however, insists that if the section is to be construed to require the assent of none but the parties to the pooling agreement it is mere surplusage. It points out that Milwaukee and Northwestern hâve assented and are now merely asking the approval and authorization of the Commission. The argument, however, overlooks the fact that the Commission may authorize pooling on the application of a single carrier or upon its own initiative. In the first case the assent of one or more other carriers, and in the second the assent of ail the carriers is a prerequisite to its action. It appears, therefore, that though confined to the parties to the pool, the requirement that ail carriers involved shall assent has a proper office in the statutory scheme. Third. In view of Escanaba’s relation to the traffic involved in the proposed pool, the decision that its assent is a prerequisite to the plan’s operation would involve the gravest inconvenience and perhaps render the provision of § 5 (1) nugatory. It is difficult to conceive of any pooling arrangement between two carriers which will not affect, in a greater or less degree, other carriers who inter- LAUF v. E. G. SHINNER & CO. 323 315 Syllabus. change trafiic with one or the other of the pooling roads, or with their connections. If the private interest of any such outside carrier should move it to refuse its assent to the arrangement it could, in the view urged by the ap-pellant, veto the proposai although, on the whole and in the long view, the consummation of the plan might greatly enhance the économies of operation of large and important carriers and so promote the public interest. We cannot believe that every carrier, in such sense affected by a proposed pool to which it is not a party, was intended to hâve a status different from, and perhaps at war with, the interest of the general public in the efficient and eco-nomical operation of the railroads envisaged by the Transportation Act. We conclude that not only the words of the statute but the obvious policy and intent underlying its provisions require an affirmance of the judgment of the District Court. Affirmed. Mr. Justice Cardozo took no part in the considération or decision of this case. LAUF et al. v. E. G. SHINNER & CO. CERTIORARI TO THE CIRCUIT COURT OF APPEALS FOR THE SEVENTH CIRCUIT. No. 293. Argued January 12, 1938.—Decided February 28, 1938. 1. An unincorporated labor union demanded of an employer that he require ail his employées, none of whom belonged to the union, on pain of dismissal, to join it and make it their bargaining agent. The employées, though left free in the matter by the employer, refused to join, having an organization of their own. The employer having rejected the demand, the members of the union, for the purpose of coercing him and in a conspiracy to ' destroy his business if he refused to yield, caused false and misleading signs to be placed before his markets; caused persons who were not his 324 OCTOBER TERM, 1937. Statement of the Case. 303 U. S. employées to parade and picket before the markets ; falsely accused him of being unfair to organized labor in dealings with employées, and, by molestation, annoyance, threats, and intimidation, pre-vented patrons and prospective patrons of the employer from patronizing the markets. Irréparable injury resulted. Held: (1) That there was a “labor dispute” within the meaning of Wisconsin Labor Code, §§ 103.62, 103.53, and of the Norris-LaGuardia Act, 29 U. S. C. § 113 (c). P. 327. (2) In a suit brought by the employer against the union for an injunction, the substantive rights of the parties were govemed by the state law, as construed by the state Suprême Court. Id. (3) An injunction was too broad which included peaceful pick-eting, advertising the employer as unfair to organized labor, solicitation of customers not to trade, etc., these being acts which are made lawful by the Wisconsin Labor Code, § 103.53, if fraud, violence or threat thereof are not involved. P. 328. (4) The District Court was without jurisdiction to grant an injunction in the absence of findings of fact required by the Norris-LaGuardia Act, 29 U. S. C. § 117. P. 329. (5) The déclarations of policy in the two Acts mentioned, to the effect that employées shall hâve full freedom of association, désignation of représentatives of their own choosing, etc., free from coercion of their employers, did not put the case be-yond the scope of those Acts, since those déclarations do not narrow the définition of “labor dispute” in the Acts; and the rights of the parties and the jurisdiction of the fédéral courts are to be determined according to the express provisions applicable to labor disputes as so defined. P. 330. 2. Since the courts below did not pass on the questions of the legal-ity under the Wisconsin law, of the acts charged to hâve been done by the union, or the constitutionality of that law in legaliz-ing any of such acts, no opinion is expressed on these questions, and the case is remanded. P. 330. 90 F. 2d 250, reversed. Certiorari, 302 U. S. 669, to review the affirmance of a decree permanently enjoining acts on the part of a labor union,—picketing, parade of misleading signs, solicitation of customers, etc.—directed against the plaintiff, a retail dealer in méats. See also 82 F. 2d 68. 323 LAUF v. E. G. SHINNER & CO. Opinion of the Court. 325 Mr. A. W. Richter argued the cause, and Mr. Morris Fromkin was on the brief, for petitioners. Mr. Walter L. Gold for respondent. Mr. Justice Roberts delivered the opinion of the Court. This is a suit to restrain the petitioners from picketing the respondent’s place of business; from coercing the respondent to discharge any of its employés who do not belong to the petitioning union, or to compel them to be-come members of the union and to accept it as their bar-gaining agent and représentative; and from advertising that the respondent is unfair to organized labor, or mo-lesting customers or prospective customers or persuading them to cease patronizing it. After a hearing, and upon findings of fact and conclusions of law, the District Court granted a preliminary injunction. The Circuit Court of Appeals affirmed.1 Upon final hearing the parties relied upon the record as made in the preliminary hearing and some additional testimony. The District Court found the following facts: The respondent is a Delaware corporation maintaining five méat markets in Milwaukee, Wisconsin. The petitioners are, respectively, an unincorporated labor union and its business manager, citizens and residents of Wisconsin. The respondent’s employés number about thirty-five; none of them are members of the petitioning union. The petitioners made demand upon the respondent to require its employés, as a condition of their continued employment, to become members of the union. The respondent notified the employés that they were free to do this and that it was willing to permit them to join but they declined 1 Lauf v. Shinner & Co., 82 F. (2d) 68. 326 ' OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. and refused to join. The union had not been chosen by the employés to represent them in any matter connected with the respondent. For the purpose of coercing the respondent to require its employés to join the union and to accept it as their bargaining agent and représentative, as a condition of continued employment, and for the purpose of injuring and destroying the business if the respondent refused to yield to such coercion, the peti-tioners conspired to do the following things and did them: They caused false and misleading signs to be placed before the respondent’s markets; caused persons who were not respondent’s employés to parade and picket before the markets; falsely accused respondent of being unfair to organized labor in its dealings with employés, and, by molestation, annoyance, threats, and intimidation pre-*vented patrons and prospective patrons of respondent from patronizing its markets; respondent suffered and will suffer irréparable injury from the continuance of the practice and customers will be intimidated and restrained from patronizing the stores as a conséquence of petition-ers’ acts. There is more than $3,000 involved in the con-troversy. The District Court held that no labor dispute, as de-fined by fédéral or state law, exists between the respondent and the petitioners or either of them; that the respondent is bound to permit its employés free agency in the matter of choice of union organization or représentation; and that the respondent had no adéquate remedy at law. It entered a final decree enjoining the petitioners from seeking to coerce the respondent to discharge any of its employés for refusai to join the union or to coerce the respondent to compel employés to become members of the organization, from advertising that the respondent is unfair to organized labor, and from annoying or molest-ing patrons or persuading or soliciting customers, présent or prospective, not to patronize the respondent’s markets. 323 LAUF v. E. G. SHINNER & CO. Opinion of the Court. 327 The Circuit Court of Appeals affirmed the decree.2 By reason of alleged conflict with a decision of the Suprême Court of Wisconsin, [222 Wis. 383; 268 N. W. 270, 873] and with our decision in Senn v. Tile Loyers Protective Union, 301 U. S. 468, we granted the writ of certiorari. In the Court of Appeals the petitioners assigned error to certain of the District Court’s findings of fact as well as to its conclusions of law. In this court the only errors assigned are to the holdings that, on the facts found, there was no labor dispute and that the Norris-LaGuardia Act and the Wisconsin Labor Code had no bearing on the case as made. In these circumstances we accept the findings of fact and confine our inquiry to the correctness of the District Court’s conclusions based upon them. The institution of the suit in the fédéral court is justi-fied by the findings as to diversity of citizenship and the amount in controversy. As the acts complained of oc-curred in Wisconsin the law of that State governs the substantive rights of the parties. But the power of the court to grant the relief prayed dépends upon the jurisdiction conferred upon it by the statutes of the United States. First. The District Court erred in holding that no labor dispute, as defined by the law of Wisconsin, existed be-tween the parties. Section 103.62, paragraph (3) of the Wisconsin Labor Code,3 is: “The term ‘labor dispute’ includes any controversy concerning the terms or conditions of employment, or con-cerning the association or représentation of persons in ne-gotiating, fixing, maintaining, changing, or seeking to arrange terms or conditions of employment, or concerning employment relations, or any other controversy arising out of the respective interests of employer and employé, regardless of whether or not the disputants stand in the proximate relation of employer and employé.” 2 90 F. (2d) 250. 3 Wisconsin Statutes, 1937, c. 103, § 103.62. 328 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. The District Court was bound by the construction of the section by the Suprême Court of the State,4 which has held a controversy indistinguishable from that here disclosed to be a labor dispute within the meaning of the statute.5 Second. The District Court erred in not applying the provisions of § 103.536 of the Wisconsin Labor Code, which déclarés certain conduct lawful in labor disputes; inter alia “giving publicity to . . . the existence of, or the facts involved in, any dispute . . . by . . . patrol-ling any public Street . . . without intimidation or coer-cion, or by any other method not involving fraud, violence, breach of the peace, or threat thereof”; advising, urging, or inducing, without fraud, violence or threat thereof, others to cease to patronize any person; peaceful picketing or patrolling, whether singly or in numbers. A Wisconsin court could not enjoin acts declared by the statute to be lawful;7 and the District Court has no greater power to do so. The error into which the court fell as to the existence of a labor dispute led it into the further error of issuing an order so sweeping as to enjoin acts made lawful by the State statute. The decree for-bade ail picketing, ail advertising that the respondent was unfair to organized labor and ail persuasion and solici-tation of customers or prospective customers not to trade with respondent. 4 Senn v. Tile Layers Union, supra, p. 477. B American Furniture Co. v. Chauffeurs, Teamsters & Helpers Union, 222 Wis. 338, 268 N. W. 250. See, also, Senn v. Tile Layers Union, supra. 6 Wisconsin Statutes, 1937, c. 103, § 103.53. 7 Senn v. Tile Layers Protective Union, 222 Wis. 383, 400, 268 N. W. 270, 872; American Furniture Co. v. Chauffeurs, Teamsters & Helpers Union, supra. 323 LAUF v. E. G. SHINNER & CO. Opinion of the Court. 329 Third. The District Court erred in granting an injunction in the absence of findings which the Norris-LaGuardia Act8 makes prerequisites to the exercise of jurisdiction. Section 13 (c) of the Act9 is: “The term ‘labor dispute’ includes any controversy con-cerning terms or conditions of einployment, or concerning the association or représentation of persons in negotiating, fixing, maintaining, changing, or seeking to arrange terms or conditions of employment regardless of whether or not the disputants stand in the proximate relation of employer and employée.” This définition does not differ materially from that above quoted from the Wisconsin Labor Code, and the facts of the instant case bring it within both. Section 710 déclarés that “no court of the United States shall hâve jurisdiction to issue a temporary or permanent injunction in any case involving or growing out of a labor dispute, as herein defined” except after a hearing of a described character, “and except after findings of fact by the court, to the effect (a) that unlawful acts hâve been threatened and will be committed unless restrained or hâve been committed and will be continued unless restrained” and that no injunction “shall be issued on ac-count of any threat or unlawful act excepting against the person or persons, association, or organization making the threat or committing the unlawful act or actually authorizing or ratifying the same . . .” By subsections (b) to (e) it is provided that relief shall not be granted unless the court finds that substantial and irréparable injury to complainants’ property will follow; that as to 8 Act of March 23, 1932, c. 90, 47 Stat. 70, U. S. C. Tit. 29, § 101 et seq. 947 Stat. 73; U. S. C. Tit. 29, § 113 (c). 10 47 Stat. 71; U. S. C. Tit. 29, § 107. 330 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. each item of relief granted greater injury will be in-flicted upon the complainant by denying the relief than will be inflicted upon défendants by granting it; that complainant has no adéquate remedy at law; and that the public officers charged with the duty to protect com-plainants’ property are unable or unwilling to provide adéquate protection. There can be no question of the power of Congress thus to define and limit the jurisdiction of the inferior courts of the United States.11 The District Court made none of the required findings save as to irréparable injury and lack of remedy at law. It follows that in issuing the injunction it exceeded its jurisdiction. Fourth. The Court of Appeals erred in holding that the déclarations of policy in the Norris-LaGuardia Act and the Wisconsin Labor Code to the effect that employés are to hâve full freedom of association, self-organization, and désignation of représentatives of their own choosing, free from interférence, restraint or coercion of their employers, puts this case outside the scope of both acts since respondent cannot accédé to the petitioner’s de-mands upon it without disregarding the policy declared by the statutes. This view was expressed in the court’s first opinion on the appeal from the issue of an interlocutory injunction,12 and the opinion on the appeal from the final order adopts what was said on the earlier appeal as the law of the case. We find nothing in the déclarations of policy which narrows the définition of a labor dispute as found in the statutes. The rights of the parties and the jurisdiction of the fédéral courts are to be determined according to the express provisions applicable to labor disputes as so defined. Fijth. Since the courts below were of opinion that a labor dispute, as defined by state and fédéral statutes, 11 Kline n. Burke Construction Co., 260 U. S. 226, 233-234. 12 82 F. (2d) 68, 72-73. 323 LAUF v. E. G. SHINNER & CO. Butler, J., dissenting. 331 had not been shown, they did not pass on the questions of the legality, under the Wisconsin law, of the acts charged to hâve been done by the petitioners or the constitutionality of that law in legalizing any of such acts. As the case must go back for further proceedings, we express no opinion upon these questions. The judgment is reversed and the cause remanded to the District Court for further proceedings in conformity with this opinion. Reversed. Mr. Justice Cardozo and Mr. Justice Reed took no part in the considération or decision of this case. Mr. Justice Butler, dissenting. The opinion just announced reflects faithfully though quite nakedly the findings of fact. These and uncon-tradicted details disclose the circumstantial basis of the suit. Local No. 73 is an unincorporated labor union, never in any way related to respondent. None of its employées is a member of the union; ail hâve definitely rejected the suggestion that they join it. In every legal sense, the union is a stranger both to respondent and its employées. Shortly before petitioners conspired to de-stroy respondent’s business, one Joyce, of the American Fédération of Labor, called by téléphoné respondent’s vice-president, Russell, at his Chicago office. The lat-ter’s uncontradicted narration of the conversation fol-lows: “Mr. Joyce . . . said We are in Milwaukee and want you fellows to join our Union up there. They tell me up there you are the man I must see, to get a contract signed for Shinner & Company with the Butchers Union up there.’ I told him I could not sign any contract with him, that our men had their own association and were perfectly well satisfied, and didn’t want to belong to any other union. He said Well, I am going there tonight 332 OCTOBER TERM, 1937. Butler, J., dissenting. 303 U. S. and if you don’t join, I will déclaré war on you.’ I said ‘There is nothing I can do about it.’ He said ‘Ail right, the war is on, and may the best man win,’ and he hung up.” Then followed a demand by the union that respondent compel its employées, on pain of dismissal from their employment, to join the union and constitute it their bargaining représentative and agent. Respondent rightly declined to undertake any such interférence with the lib-erty of its employées, but informed them that they were free to do as they saw fit. It left them wholly free to join or not to join the union; the union was left free to invite, urge, persuade or induce them to join. Every one who respects the lawful exercise of individual liberty of action must regard the attitude of the respondent as being above criticism and beyond reproach. The opinion of the Court just announced does not suggest a contrary view. Under these circumstances, the union, in order to force respondent to coerce its employées, and in pursuance of a conspiracy to that end, publicly and falsely accused respondent of being unfair to labor in dealing with its employées; and by means of false placards and banners and by picketing, molestation, annoyance, threats and intimidation it prevented, and when this suit was brought was continuing to prevent, patrons and prospective patrons from dealing with respondent—ail to the latter’s serious and irréparable injury. 1. Respondent’s business constitutes a property right; and the free opportunity of respondent and its customers to deal with one another in that business is an incident inséparable therefrom. It is hard to imagine a case which more clearly calls for équitable relief ; and the court below rightly granted an injunction. Truax v. Corrigan, 257 U. S. 312, 327, and cases cited. 323 LAUF v. E. G. SHINNER & CO. 333 Butler, J., dissenting. But here it is held that the decree conflicts with the Norris-LaGuardia Act. That the action demanded by petitioners of respondent with respect to its employées, if taken, would hâve been morally indefensible is plain; that it would hâve been against the declared policy of the Act is equally plain. That Act, 29 U. S. C., § 102,1 déclarés that under prevailing conditions, the individual unorganized worker, “though he should be free to décliné to associate with his fellow workers” should “hâve full freedom of association, self-organization, and désignation of représentatives of his own choosing,” and should “be free from the interférence, restraint, or coercion of em-ployers of labor, or their agents, in the désignation of such représentatives,” etc. This déclaration of policy, as the introductory clause plainly recites, was intended as an 1 Section 2 of the Act of March 23, 1932, 47 Stat. 70, 29 U. S. C. § 102: “Public policy in labor matters declared. In the interprétation of this chapter and in determining the jurisdiction and authority of the courts of the United States, as such jurisdiction and authority are defined and limited in this chapter, the public policy of the United States is hereby declared as follows: “Whereas under prevailing économie conditions, developed with the aid of governmental authority for owners of property to organize in the corporate and other forms of ownership association, the individual unorganized worker is commonly helpless to exercise actual liberty of contract and to protect his freedom of labor, and thereby to obtain acceptable terms and conditions of employment, wherefore, though he should be free to décliné to associate with his fellows, it is necessary that he hâve full freedom of association, self-organization, and désignation of représentatives of his own choosing, to negotiate the terms and conditions of his employment, and that he shall be free from the interférence, restraint, or coercion of employers of labor, or their agents, in the désignation of such représentatives or in self-organization or in other concerted activities for the purpose of collective bargaining or other mutual aid or protection; therefore, the following définitions of and limitations upon the jurisdiction and authority of the courts of the United States are hereby enacted.” 334 OCTOBER TERM, 1937. Butler, J., dissenting. 303 U. S. aid “in the interprétation” of the Act and “in determining the jurisdiction and authority of the courts” under the Act. If respondent had joined the conspiracy and yielded to the demand of the union its action as an employer of labor unquestionably would hâve constituted an “interférence, restraint, or coercion” of its employées in the désignation of their représentatives, in the teeth of the declared policy of the Act. The opinion of the Court asserts, however, that this definite déclaration of policy in no way narrows the définition of the phrase “labor dispute” found in substantive provisions of the Act. But that statement cannot be intended to suggest that the déclaration of policy does not affect the meaning and application of the words used, for the opening clause of that déclaration is precisely to the contrary. Whether a labor dispute exists in a given case dépends upon the facts; and in each case the phrase “labor dispute” is to be interpreted in harmony with the declared policy of the Act. That is the congressional mandate and courts are required to observe it. In Ozawa v. United States, 260 U. S. 178, 194, we said “It is the duty of this Court to give effect to the intent of Congress. Primarily this intent is ascertained by giving the words their natural significance, but if this leads to an unreasonable resuit plainly at variance with the policy of the législation as a whole, we must examine the matter fur-ther. We may then look to the reason of the enactment and inquire into its antécédent history and give it effect in accordance with its design and purpose, sacrificing, if necessary, the literal meaning in order that the purpose may not fait” See also to the same effect, Heydenjeldt v. Daney Gold & S. M. Co., 93 U. S. 634, 638; Holy Trinity Church v. United States, 143 U. S. 457, 459 et seq.; Fleischmann Construction Co. v. United States, 270 U. S. 349, 360; Karnuth v. United States, 279 U. S. 231, 243. The principle applies here with peculiar force; LAUF v. E. G. SHINNER & CO. 335 323 Butler, J., dissenting. for it is an unnatural assumption to suppose that Congress intended by general définition of the flexible term “labor dispute” to annul its own very explicit déclaration in respect to the policy to be observed by the courts in the administration of the Act. The decision just announced ignores the declared policy of Congress that the worker should be free to décliné association with his fellows, that he should hâve full free-dom in that respect and in the désignation of représentatives, and especially that he should be free from interférence, restraint, or coercion of employers. To say that a “labor dispute” is created by the mere refusai of respondent to comply with the demand that it compel its employées to designate the union as their représentative unmistakably subverts this policy and consequently puts a construction upon the words contrary to the manifest congressional intent. Moreover, the immediately preceding section of the Act, 29 U. S. C., § 101,2 provides that no restraining order or injunction in a case involving or growing out of a labor dispute shall issue “contrary to the public policy declared in this chapter.” Sections 101 and 102 taken together constitute nothing less than an expression of the legislative will that the court shall enforce the public policy set forth in § 102 and shall hâve regard thereto in reaching a détermination as to whether it has jurisdiction to issue an injunction in any particular case. Since the 2 Section 1 of the Act of March 23, 1932, 47 Stat. 70, 29 U. S. C. § 101: “Issuance of restraining orders and injonctions; limitation; public policy. No court of the United States, as defined in this chapter, shall hâve jurisdiction to issue any restraining order or temporary or permanent injunction in a case involving or growing out of a labor dispute, except in a strict conformity with the provisions of this chapter; nor shall any such restraining order or temporary or permanent injunction be issued contrary to the public policy declared in this chapter.” 336 OCTOBER TERM, 1937. Butler, J., dissenting. 303 U. S. whole aim of the in jury here inflicted and threatened to be inflicted by the union was to compel respondent to influence and coerce its employées in the désignation of their représentatives, the acts of the union were in plain défiance of the declared policy of Congress, and find no support in its substantive provisions. 2. But putting aside the congressional déclaration of policy as an indication of meaning, and considering the phrase entirely apart, the facts of this case plainly do not constitute a “labor dispute” as defined by the Act. Un-doubtedly “dispute” is used in its primary sense as meaning a verbal controversy involving an expression of op-posing views or claims. The Act itself, 29 U. S. C., §113 (c), so regards it: “The term ‘labor dispute’ includes any controversy concerning terms or conditions of em-ployment,” etc. In this case, there was no interchange or considération of conflicting views in respect of the set-tlement of a controversial problem. There was simply an overbearing demand by the union that respondent should do an unlawful thing and a natural refusai on its part to comply. If a demand by a labor union that an employer compel its employées to submit to the will of the union, and the employer’s refusai, constitute a labor controversy, the highwayman’s demand for the money of his victim and the latter’s refusai to stand and deliver constitute a financial controversy. There being an utter lack of connection between the petitioners and respondent or its employées, the union was an intruder into the affairs of the employer and its employées. The union had the right to try to persuade the employées to join its organization; but persuasive methods failing, its right under the law in any manner to intermeddle came to an end. It lawfully could not coerce the employées to abandon their own organization and to join Local No. 73 any more than the employées could coerce the union to disband and its members to join 323 LAUF v. E. G. SHINNER & CO. Butler, J., dissenting. 337 their organization. Otherwise, the worker would not “be free,” as the Act requires, “to décliné to associate with his fellows” ; nor would he hâve “full freedom of association, self-organization and désignation of représentatives of his own choosing.” Clearly the union could not be authorized by statute to resort to coercive measures di-rectly against the employées to compel submission to its wishes, for that would be to give one group of workmen autocratie power of control in respect of the liberties of another group, in contravention of the Fifth Amendment as well as of the policy of Congress expressly declared in this Act. And that being true, the attempt to coerce submission through constrained interférence of the employer was equally unlawful. So far as concerns the question here involved, the phrase “labor dispute” is the basic element of the Act. For un-less there was such a dispute—that is to say, a “contro-versy”—the Act does not even purport to limit the district court’s jurisdiction in equity. The phrase must reçoive a sensible construction in harmony with the con-gressional intent and policy. There can be no dispute without disputants. Between whom was there a dispute here? There was none between the union and respond-ent’s employées; for the latter were considered by the union mere pawns to be moved according to the arbitrary will of the union. There was none between respondent and its employées; for théy were in full accord. And finally there was none between the union and respondent; for it would be utterly unreasonable to suppose Congress intended that the refusai of a conscientious employer to transgress the express policy of the law should constitute a “labor dispute” having the effect of bringing to naught not only the policy of the law, but the obligation of a court of equity to respect it and to restrain a continuing and destructive assault upon the property rights of the employer, as to which no adéquate remedy at law existed. 53383°—38---------22 338 OCTOBER TERM, 1937. Butler, J., dissenting. 303 U. S. 3. As to what constitutes a “labor dispute” within the meaning of the Wisconsin statute, the interprétation put upon it by the highest court of that state is binding here. Knights of Pythias v. Meyer, 265 U. S. 30, 32. More-head v. New York ex rel. Tipaldo, 298 U. S. 587, 609. But this Court authoritatively déclarés the meaning of Acts of Congress and is required to décidé for itself what constitutes a “labor dispute,” which, within the meaning of the Norris-LaGuardia Act, will hâve the effect of abridging the jurisdiction of a fédéral court. The things here found to hâve been done for the pur-pose of coercing respondent to compel its employées to join the union are not declared lawful by the Wisconsin statute or by the courts of that state. Cf. American Fur-niture Co. v. Chauffeurs, T. & H. Union, 222 Wis. 338; 268 N. W. 250 ; Senn v. Tile Layers Protective Union, 222 Wis. 383; 268 N. W. 270, 872. While this Court refrains from condemning the means employed by petitioners, the opinion contains nothing to suggest that their conduct was not wrongful and unlawful. The publicity and peace-ful picketing declared legal by Wisconsin laws are utterly unlike the display of libelous signs, parade of pickets, false accusations, molestation, threats and intimidation employed by the union, not on behalf of former or présent employées of respondent, but to destroy the business of respondent. Here, by means everywhere held to be unlawful, the union carried on and was continuing to carry on a campaign of destruction in order to coerce respondent to deprive its employées of their right of free-dom of association, self-organization and désignation of représentatives of their own choosing. That the Wisconsin statute does not attempt to make lawful the means employed by the union to impose its will upon respondent and its employées clearly appears from this Court’s por-trayal of that law in Senn n. Tile Layers Union, 301 U. S. 468. 323 LAUF v. E. G. SHINNER & CO. Butler, J., dissenting. 339 The opinion in that case states (p. 478) : “The judg-ment of the highest court of the state establishes that both the means employed and the end sought by the unions are legal under its law . . . The Législature of Wisconsin has declared that ‘peaceful picketing and pa-trolling’ on the public streets and places shall be permis-sible ‘whether engaged in singly or in numbers’ provided this is done ‘without intimidation or coercion’ and free from ‘fraud, violence, breach of the peace or threat thereof.’ The statute provides that the picketing must be peaceful; and that term as used implies not only absence of violence but absence of any unlawful act. It pre-cludes the intimidation of customers. It precludes any form of physical obstruction or interférence with the plaintiff’s business. It authorizes giving publicity to the existence of the dispute ‘whether by advertising, patrolling any public streets or places where any person or persons may lawfully be’ ; but precludes misrepresentation of the facts of the controversy. And it déclarés that ‘nothing herein shall be construed to legalize a secondary boycott.’ . . . Inherently, the means authorized are clearly unobjectionable. In declaring such picketing permissible Wisconsin has put this means of publicity on a par with advertisements in the press. . . . The picketing was peaceful. The publicity did not involve a misrepresentation of fact ; nor was any claim made below that relevant facts were suppressed.” The state statute, defining “labor disputes” and declaring the means that lawfully may be used against employ-ers in such controversies, does not purport to make lawful either the end here sought by petitioners or the means they employed to attain it. Their purpose was not union-ization of respondent’s employées, for they already be-longed to a labor organization of their own choosing. The purpose was to coerce the employées to join a particular organization which they had already repudiated. There 340 OCTOBER TERM, 1937. Butler, J., dissenting. 303 U. S. is nothing in the state or fédéral statutes that purports to give labor unions or individuals so contriving the status of party to a “labor dispute.” Coercion of employées to surrender their freedom of self-organization is répugnant to both statutes. Wis. Stats., 1937, § 103.51. 29 U. S. C. §§ 101, 102. Cf. American Furniture Co. v. Chauffeurs, T. & H. Union, 222 Wis. 338; 268 N. W. 250; Senn N. Tile Layers Protective Union, 222 Wis. 383; 268 N. W. 270, 872; Senn v. Tile Layers Union, 301 U. S. 468. There is no ground upon which petitioners’ purpose in this case or the means employed to accomplish it can be supported as lawful. 4. The case is a simple one. Respondent’s employées had no connection with the union, and were unwilling to hâve any. The union, being unable to persuade the employées to assent to its wishes in that regard, undertook to subjugate them to its will by coercing an unlawful interférence with their freedom of action on the part of the employer. If that is a “labor dispute,” destructive of the historical power of equity to intervene, then the Norris-LaGuardia Act attempts to legalize an arbitrary and alien state of affairs wholly at variance with those prin-ciples of constitutional liberty by which the exercise of despotic power hitherto has been curbed. And nothing is plainer under our decisions than that if the Act does that, its effect will be to deprive the respondent of its property and business without due process of law, in contravention of the Fifth Amendment. Truax v. Corrigan, supra, 327-328. I am of opinion that the circuit court of appeals rightly held that this case discloses no “labor dispute” within the meaning of the Norris-LaGuardia Act; that the union’s coercive attack upon respondent was unlawful under state law and in violation of the policy declared by the fédéral statute, and was properly enjoined; and that, there being no “labor dispute” as defined by that Act, its pro- 323 UNITED STATES v. PATRYAS. Counsel for Parties. 341 visions as to allégations, proof, and findings do not apply. I would affirm the judgment. Me. Justice McReynolds concurs in this opinion. UNITED STATES v. PATRYAS. CERTIORARI TO THE CIRCUIT COURT OF APPEALS FOR THE SEVENTH CIRCUIT. No. 445. Argued February 11, 1938.—Decided February 28, 1938. Under § 307 of the World War Vétérans Act, as amended July 3, 1930, a claim for total permanent disability on a reinstated and converted War Risk policy can not be contested upon the bare ground that the total and permanent disability existed before the Insurance was reinstated. P. 342. Section 307 provides that policies of insurance “issued, reinstated, or converted shall be incontestable from the date of is-suance, reinstatement, or conversion, except for fraud, nonpay-ment of premiums, or on the ground that the applicant was not a member of the military or naval forces of the United States.” The converted policy sued on promised to pay in the event of total, permanent disability, upon due proof of such disability “while this policy is in force.” Unlike original policies issued under the War Risk Act, it contained no clause expressly exclud-ing liability for total, permanent disability incurred before the policy was applied for. 90 F. 2d 715, affirmed. Certiorari, 302 U. S. 676, to review the affirmance of a judgment recovered against the Government on a Vet-eran’s policy of insurance. Mr. Wilbur C. Pickett, with whom Solicitor General Reed, Assistant Solicitor General Bell, and Messrs, Julius C. Martin and W. Marvin Smith were on the brief, for the United States. Mr. Warren E. Miller, with whom Mr. Stephen A. Cross was on the brief, for respondent. 342 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. Mr. Justice Black delivered the opinion of the Court. January 31,1918, Stanley J. Patryas (respondent), then a soldier, purchased from the government a $10,000 yearly renewable War Risk Insurance contract which he permitted to lapse after his honorable discharge from the Army, July 29, 1919. June 28, 1927, while a patient at a Vétérans’ Government Hospital, he obtained reinstate-ment of his War Risk policy and immediately converted it into a five year renewable term policy upon which he paid premiums to June 1932. Claiming total permanent disability, the vétéran obtained, in the District Court, a verdict and judgment on his reinstated policy. Finding the issues for the vétéran, the jury fixed the date of permanent total disability at 1924—a date three years before his policy was reinstated. The Court of Appeals affirmed.1 The government’s right to contest this policy is limited by the following statutory provision :2 “. . . policies of insurance . . . issued, reinstated, or converted shall be incontestable from the date of issuance, reinstatement, or conversion, except for fraud, nonpay-ment of premiums, or on the ground that the applicant was not a member of the military or naval forces of the United States, . . .” The question here is: Can the government, in the absence of fraud or bad faith, “contest” and defeat payment of total permanent disability insurance, sold to a World War vétéran, on the ground that the vétéran was totally and permanently disabled before the policy was reinstated and converted? First. The government contends that “Congress has 190 F. (2d) 715. 2 Sec. 307, World War Vétérans Act, 1924, as amended July 3, 1930, c. 849, § 24, 46 Stat. 1001. 341 UNITED STATES v. PATRYAS. Opinion of the Court. 343 not, . . . authorized . . . Insurance benefits for total, permanent disability existing prior to any contract of Insurance on which the claim is made.” The original War Risk Insurance Act of October 6, 1917,3 provided: “That in order to give every commissioned officer and enlisted man and to every member of the Army Nurse Corps (female) and of the Navy Nurse Corps (female) when employed in active service under the War Department or Navy Department greater protection for them-selves and their dependents . . . , the United States, upon application to the bureau and without medical examination, shall grant insurance against the death or total permanent disability of any such person . . .” The War Risk Insurance Act must be considered in the light of its passage during the war, while men and women were being called into war service. This requires récognition of its generous and liberal purpose to provide “ greater protection for (soldiers, sailors and nurses) . . . and their dependents.”4 Its passage indicated Congress conclusively presumed that every person, who had successfully undergone mental and physical examination for war service, was—when inducted into such service— insurable against death and total permanent disability.5 The Act commanded that insurance against death and total permanent disability be granted, without medical examination, to every applicant who had previously been examined and accepted for war service. Congress mani-festly intended by these sweeping provisions that policies should be granted without regard to the health of appli-cants and should be enforceable obligations against the government. Any other construction of this broad, war 3 Sec. 400, War Risk Insurance Act of Oct. 6, 1917, c. 105, 40 Stat. 409. 4 See, United States v. Arzner, 287 U. S. 470, 472. 5 See, United States v. Domangue, 79 F. (2d) 647, 648. 344 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. time legislative grant to soldiers, sailors and nurses would take away the benefits Congress intended them to receive. The provisions of the War Risk Insurance Act are suf-ficiently comprehensive and inclusive to authorize its ad-ministrators to grant insurance covering past or future total permanent disability, if such action is found necessary to carry out its far reaching national plan and pur-poses. Second. It is contended that the government can con-test liability on the ground that the vétéran was totally and permanently disabled prior to the reinstatement, despite the provision that such policy “shall be incontestable . . . except for fraud, nonpayment of premiums, or on the ground that the applicant was not a member of the military or naval forces of the United States, . . .” It is urged that this provision “has no application where, as here, the validity of the policy is not questioned and liability under it is denied solely on the ground that a loss has not occurred during the period of insurance protection.” However, it is admitted that this policy did not “expressly exclude total permanent disability occurring prior to insurance protection, as did the language of the original term contract.” This converted policy of insurance provided protection against loss from two causes: namely, death and total permanent disability. A provision making a policy “incontestable” except for certain clearly designated reasons, is wholly meaningless and ineffective if, after proof of the loss insured against, the policy can be contested upon grounds wholly different from those set out in the exception. The object of the provision is to assure the insured that payment on his policy will not be delayed by con-tests and lawsuits on grounds not saved by the exceptions.6 Here, it has been established that the vétéran is 6 Northwestern Mutual Life Ins. Co. v. Johnson, 254 U. S. 96, 101, 102. 341 UNITED STATES v. PATRYAS. Opinion of the Court. 345 totally and permanently disabled. Yet his policy is con-tested on the ground that it does not insure against this disability because it existed before the policy was issued. If this defense can be interposed, his policy has never ac-tually protected him against total permanent disability. Since permanent total disability is one of the two risks in-sured against in the policy, any contest (not based on the exceptions) which may prevent the policyholder’s re-covery for such admitted total permanent disability— existing while the policy is in force—is a “contest” for-bidden by the “incontestable” provision. No legal obstacle prevents parties, if they so desire, from entering into contracts of Insurance to protect against loss that may possibly hâve already occurred. Marine insurance and ante-dated fire Insurance policies frequently afford protection against risks which, unknown to the parties, hâve already attached.7 Even with the benefit of scrupulous good faith, it is not always easy to détermine with complété certainty whether or not total permanent disability exists. This uncertainty may lead an insurer, after his own investigation, and for adéquate compensation, to treat unknown past and uncertain prospective disability, upon the same basis. This case is an illustration. Here, the government has never admitted that the vétéran is totally and permanently disabled. It not only issued him a policy against such disability—with complété knowledge of his then condition—but in this continued contest has denied that the policyholder was totally and permanently dis- 1 General Interest Ins. Co. N. Ruggles, 12 Wheat. 408; see, Hooper v. Robinson, 98 U. S. 528, 537; Pendergast v. Globe & R. Fire Ins. Co., 246 N. Y. 396; 159 N. E. 183; Hallock v. Commercial Ins. Co., 26 N. J. L. (2 Dutch.) 268; see, Springfield Fire & M. Ins. Co. v. National Fire Ins. Co., 51 F. (2d) 714, 718-719. A valid aleatory contract may be based on an unknown past event. 3 Williston, On Contracts, (Rev. ed.), § 888. 346 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. abled at any time—before, when, or after the policy was issued. There was also a sharp conflict of evidence on this disputed fact. When a policy of disability Insurance is issued after complété examination by the insurer and full and fair disclosure by both parties, there is no legal reason why the insurer cannot contract to afford full protection against loss resulting from past as well as prospective disability. This veteran’s policy did not expressly limit liability to prospective total permanent disability. The provisions of the policy in this regard contain a promise to pay the vétéran “in . . . event of the total permanent disability . . . (and) Upon due proof of the total permanent disability of the Insured while this policy is in force, . . .” Original policies issued under the War Risk Act expressly excluded liability for total permanent disability incurred before the policy “was applied for.” The delib-erate omission, in the converted policies, of this previous exclusion, the language and purport of the original Act and its amendments, the administrative interprétations and legislative history, ail throw a flood of light on the intention to include liability for disabilities existing prior to the issuance of the policies. For more than a decade prior to 1934, (during which period this veteran’s policy was purchased), the Bureau, unvaryingly observing the statutory mandate, announced and applied the practice that “Insurance was incontestable except for the grounds specifically enumerated” in the incontestable provision. A “subséquent rating of permanent total disability effective as of a date prior to the date of reinstatement” under this consistent administrative interprétation and practice, did “not affect the valid-ity of such reinstatement.” Because of court decisions and rulings by the Comptroller General tending to nullify and defeat this administrative practice8 the Vétérans’ 8 9 Compt. Gen. 291; Jordan n. United States, 36 F. (2d) 43; Golden v. United States, 34 F. (2d) 367. 341 UNITED STATES v. PATRYAS. Opinion of the Court. 347 Administration urged the amendment of July 3, 1930, to confirm its practice and to strengthen and clarify the incontestable provision. For this purpose, the Administra-tor of Vétérans’ Affairs testified before the Senate Committee as to the necessity for this amendment:9 “This is a very sweeping amendment and will place be-yond contest many contracts and policies of insurance which otherwise would be contestable. It is a well recog-nized principle of commercial insurance companies, how-ever, and in reality is only a clarification of the existing law which was practically nullified by a recent decision of the Comptroller General.” The Soliciter of Vétérans’ Affairs also testified: . the présent World War Vétérans Act of 1924, as amended, contains a provision to the effect that where a policy is maintained in force for a period of six months, it should be incontestable, except for fraud or nonpay-ment of premiums. We hâve followed that, and in ail cases where the policy has remained in force for six months we hâve paid the claim, irrespective of the merits of it, unless there was fraud or failure to pay premiums. . . . However, under date of January 16, 1930, notwithstanding the long practice of the bureau, the Comptroller General, in the case of Mabry W. Woodall, held that if a man was permanently and totally disabled at the time he applied for a reinstatement of insurance, or conversion of insurance, . . . the policy was not incontestable, the statute did not protect it . . In the Woodall case referred to, the Comptroller General had held: “... if the insured was in fact dead or permanently and totally disabled, at the date of application, reinstatement or conversion, . . . the insurance was subject to subséquent contest. 9 H. R. 10381, 71st Cong., 2d Sess., Hearings Senate Committee on Finance, pages 90-91. 348 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. “Accordingly, the rule may be stated that where the Vétérans’ Bureau has heretofore established or may here-after establish the condition of permanent total dis-ability at or prior to date of original application for insurance, or application for reinstatement and/or conversion of insurance, . . . the insurance should be considered as invalid .. ” The Senate Report on this amendment10 stated : “The purpose is to make ail contracts or policies of insurance incontestable from date of issuance, reinstatement, or conversion, for ail reasons except fraud, non-payment of premiums, or that the applicant was not a member of the military or naval forces of the United States. This incontestability would protect contracts ... where the applicant was not in the required state of health, or was permanently and totally disabled prior to the date of application, ... It is appreciated that this is a broad provision, but it was felt that it was necessary in order to do justice to the vétérans, . . . and to over-come decisions of the Comptroller General which prac-tically nullified the section as it now exists.” The conclusion is inescapable that Congress enacted the 1930 amendment in order to overcome the effect of the above rulings of the courts and the Comptroller General, and with the intention to sustain the Bureau’s previous administrative interprétation and practice under the incontestable provision. To resist payment of this veteran’s insurance policy on the ground that he was totally and permanently disabled prior to the issue of the policy, is to “contest” payment within the generally accepted meaning of the word and violâtes the “incontestable” provision. The pur-chaser of a policy contract containing a provision that 10 Senate Report No. 1128, p. 10, 71st Cong., 2d Sess., on H. R. 13174. 341 UNITED STATES v. PATRYAS. Opinion of the Court. 349 the insurer waives its right to contest except for fraud, nonpayment of premiums, and lack of military or naval service, is entitled to rely on the plain terms and induce-ments of the provision which limits the grounds for contest of liability to those specifically reserved.11 The incontestable provision here means that a claim of a vétéran whose death or total permanent disability is estab-lished shall not be contested except for fraud, nonpayment of premiums or on the ground that the insured had not really been a member of the war forces of the nation or because he was included in Title 38, U. S. C., § 447.12 Congress evidently believed these exceptions afforded the government ample protection against impositions or unjust claims and intended to limit the right to contest these policies to the spécifie grounds reserved in the exceptions. The judgment of the Court of Appeals is Affirmed. Mr. Justice Cardozo and Mr. Justice Reed took no part in the considération or decision of this case. 11 See, Northwestern Mutual Life Ins. Co. v. Johnson, supra, at 102. 12 38 U. S. C., § 518, and § 447. This reference to § 447 excluded from the benefits of this incontestable provision any person who had been discharged or dismissed from the service on the ground that he was “guilty of mutiny, treason, spying, or any offense involving moral turpitude, or willful and persistent misconduct, of which he was found guilty by a court-martial, or that he was an alien, consci-entious objector who refused to perform military duty or refused to wear the uniform, or a deserter, . . .” 350 OCTOBER TERM, 1937. Syllabus. 303 U. S. ADAIR v. BANK OF AMERICA NATIONAL TRUST & SAVINGS ASSN. CERTIORARI TO THE CIRCUIT COURT OF APPEALS FOR THE NINTH CIRCUIT. No. 365. Argued February 2, 1938.—Decided February 28, 1938. 1. Subdivisions (e) and (n) of § 75 of the Bankruptcy Act, which provide for exercise of such control over the property of the farmer-debtor as the court deems in his best interest and in that of his creditors, look to the maintenance of the farm as a going concern and authorize, in a proper case, the continuance of the farm operations after the filing of the pétition. P. 354. 2. A conciliation commissioner, appointed pursuant to § 75 of the Bankruptcy Act and Rule L of the General Orders in Bankruptcy, exercises judicial powers like those of a referee in bankruptcy; his acts in authorizing expenditure of funds in his charge, if performed in good faith and not in violation of any rule or positive enaetment, are judicial acts for which he can not be held personally liable. P. 357. 3. In a proceeding under § 75 of the Bankruptcy Act, proceeds of the sale of a crop of grapes were spent by the conciliation commissioner in harvesting the crop and in work for the préservation of the vineyard and cultivation of the crop for the next year. Part of the disbursements were made before the farmer-debtor was adjudged a bankrupt, and part thereafter by direction of the referee. A creditor claimed the gross proceeds of the sale under a mortgage of the crop sold and future crops. The same creditor had a mortgage on the farm. Held: (1) That, as the commissioner acted either judicially, as conciliation commissioner, or ministerially, as an arm of the court by authority of the referee, he was not personally liable to the creditor. P. 358. (2) Expenditures, reasonable in amount, for gathering the crop sold, and also those in préparation for the next year’s crop and for maintenance of the property, were proper charges on the fund, being for its protection and in the interest of the mortgagee. P. 360. 90 F. 2d 750, reversed. ADAIR v. BANK OF AMERICA ASSN. 351 350 Opinion of the Court. Certiorari, 302 U. S. 674, to review a judgment which reversed an order of the district court settling the final account of the présent petitioner as a conciliation com-missioner in a bankruptcy proceeding. Mr. William Lemke, with whom Mr. Harold M. Sawyer was on the brief, for petitioner. Mr. Hugo A. Steinmeyer, with whom Mr. William C. Day was on the brief, for respondent. Mr. Justice Reed delivered the opinion of the Court. This writ was asked to review a decree of the Circuit Court of Appeals for the Ninth Circuit, upholding the objections and exceptions of the respondent, a créditer, to the final account of petitioner, a conciliation commis-sioner appointed under § 75 (a) of the Bankruptcy Act, and reversing the order of the District Court which had settled and allowed the account. The Circuit Court of Appeals held that the petitioner should hâve been required to pay to respondent the gross proceeds of the grape crop harvested on the debtor’s land after the debtor had filed his pétition under § 75 of the Bankruptcy Act, without any déduction for moneys spent in harvesting that crop and for other purposes, because of the fact that the crop was subject to a chattel mortgage held by respondent. 90 F. (2d) 750. In view of the importance of the question with respect to proceedings instituted under § 75 of the Bankruptcy Act, this Court granted certiorari. On August 6, 1934, Andrea Cuccia, a farmer, filed an adéquate pétition under § 75 (a) to (r) of the Bankruptcy Act, showing by the schedules secured daims to respondent of over $12,000 and unsecured daims of a 352 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. slightly larger amount, and expressing his desire to effect a composition or extension of time to pay his debts. His pétition was referred to Noah Adair, the Conciliation Commissioner for the County of San Bemardino, California. On January 7, 1935, an amended pétition was filed by the debtor, stating that he had failed to obtain the approval of his creditors to a composition or extension proposai and praying that he might be adjudged a bankrupt under the provisions of § 75, subsection (s) of the Bankruptcy Act, as enacted June 28, 1934. Adjudication was entered and the proceedings referred to the Referee in Bankruptcy. On October 14, 1935, the District Court, on a motion by the respondent, dismissed the pétition. On March 16, 1936, the debtor attempted to invoke the benefits of the amended § 75 (s), but we are not here concerned with that pétition and the subséquent proceedings (set out in Bank oj America National Trust & S. Assn. v. Cuccia, 93 F. (2d) 754, de-cided December 30, 1937, on rehearing, by the Circuit Court of Appeals for the Ninth Circuit). The respondent, at the beginning of and throughout the proceedings, held a matured note of the debtor and his wife, secured by a deed of trust on certain lands in the County of San Bernardino, California, and by a mortgage on the crops growing or to be grown on the same lands, during 1933 and 1934, or prior to the payment in full of the total indebtedness. The crop mortgage required the mortgagor to cultivate, harvest and deliver the crop to the mortgagee, without cost to the mortgagee, for sale and application of the proceeds to the debt. The présent controversy had its origin in the respond-ent’s pétition to the Court, on February 6, 1936, for an accounting by the conciliation commissioner of funds realized from crops sold off the debtor’s premises in 1934. In response to the order of the District Court, the conciliation commissioner made an accounting as appears in ADAIR v. BANK OF AMERICA ASSN. 353 350 Opinion of the Court. the footnote? The Bank objected to the account on the ground that the money was the proceeds of the sale 1 Account—Filed February 17, 1936 : September 26, 1934—An account in the naine of Andrea Cuccia and Noah Adair was opened with the American National Bank, San Bemardino, California, and a de-posit of $1,437.37 was made.................... $1,437.37 September 26, 1934—Cash, labor, for 20 men on ranch. Court Order issued*................................ 340.00 October 1, 1934—Andrea Cuccia..................... 59.33 October 30, 1934—Andrea Cuccia, 14 days labor Court order issued....................................... 42.00 November 27, 1934—Andrew Cuccia, $15. living expense $20. filing fee under 75(s) and $20, feed for horse. Court order.......................................* 55.00 December 20, 1934—Andrea Cuccia, $10. feed for horse and $10. living expense............................ 20.00 January 22, 1935—Andrea Cuccia, $20. and labor on grove $144.00..................................... 164.00 [fol. 18] January 22, 1935—D. W. Richards indemnity fee under Section 75 (s)........................... 18.25 February 1, 1935—Andrea Cuccia, labor, 8 men, 11 days each.............................................. 264.00 February 15, 1935—Andrea Cuccia labor.............. 90.00 March 15, 1935—Andrea Cuccia, $45. labor; $20. hay and $10. living expense............................... 75.00 April 19, 1935—Jos. E. Rich, Court Reporter........ 22.50 April 19, 1935—Ralph W. Eckhardt, attorneys fee.. 50.00 April 19, 1935—Andrea Cuccia, 37 days work of hired men. 111.00 May 11, 1935—Andrea Cuccia, sulphur for grapes... 60.00 June 1, 1935—Andrea Cuccia, labor for two men working in grapes.......................................... 30.00 Total............................................. $1,401.08 Tax, etc............................................. .60 $1,401.68 Balance in bank to date, $35.69. * [The “court order” refers to an order entered by petitioner him-self. The only order entered by the District Court as to these ex-penditures was its order of approval of the account filed by petitioner.] 53383°—38-----------23 354 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. of a crop covered by the chattel mortgage above referred to and that the disbursements from the fund were made without valid order by the District Court and without the Bank’s notice or knowledge of any court order. It was further objected that after adjudication in bank-ruptcy under § 75 (s) the conciliation commissioner had no jurisdiction. Petitioner stated in his answer and tes-timony that the items appearing prior to the adjudication in bankruptcy of January 7, 1935, were disbursed, on his orders as conciliation commissioner, either to gather the 1934 crop or to provide for care of the property, and that the items appearing from January 22 through June 1, 1935, were disbursed under the direction of the referee in bankruptcy. The District Court, finding that the ex-penditures of the conciliation commissioner were made in good faith and for the purpose of conserving the estate, settled and allowed the account. The Circuit Court of Appeals directed the disallowance of the account and the payment by the conciliation commissioner to the respondent of the gross proceeds of the mortgaged crop. First. The powers granted by the bankruptcy clause of the Constitution, Article 1, § 8, cl. 4, are not limited to the bankruptcy law and practice in force in England or the States at the time of its adoption. Continental Illinois Nat. Bank & T. Co. N. Chicago, R. I. & P. Ry. Co., 294 U. S. 648, 668. Then the interests of the credi-tor alone were protected. Progressive liberalization of bankruptcy and insolvency laws, in an effort to avert the evils of liquidation, has fumished opportunity for composition in bankruptcy proceedings and later for composition and extension of debts in relief proceedings for in-dividual debtors, for reorganization of railroads and other corporations, and for public debtor proceedings.2 2 Bankruptcy Act of 1867, as amended by the Act of 1874, c. 390, § 17, 18 Stat. 178, 182; Act of March 3, 1933, c. 204, 47 Stat. 1467; Act of June 7, 1934, c. 424, 48 Stat. 911; Act of June 28, 1934, c. ADAIR v. BANK OF AMERICA ASSN. 355 350 Opinion of the Court. Section 75 of the Bankruptcy Act3 provides similar opportunities for the réhabilitation of farmers. Wright v. Vinton Branch Bank, 300 U. S. 440, 456. It is sought to accomplish this réhabilitation through composition or extension of debts, subsections (e) to (1). On failure of composition and extension, further oppor-tunity for réhabilitation is afforded the debtor, through provisions enabling him to retain possession of his property, under conditions favorable to its ultimate rédemption by him. These steps are carried out under judicial supervision, subsection (s).4 To accomplish its purpose, § 75 provides that the filing of a pétition shall effect a stay.5 Such a stay under 869, 48 Stat. 1289; Act of April 10, 1936, c. 186, 49 Stat. 1198; Act of April 11, 1936, c. 210, 49 Stat. 1203, Act of August 16, 1937, c. 657, 50 Stat. 653. 3 Subsections (a) to (r) were added by the Act of March 3, 1933, c. 204, § 1, 47 Stat. 1470-1473, and subsections (a) and (b) amended by the Act of June 7, 1934, c. 424, §§ 8 and 9, 48 Stat. 911, 925. Subsection (s), the first Frazier-Lemke Act, was added June 28, 1934, c. 869, 48 Stat. 1289. Subséquent to the decision in Louisville Joint Stock Land Bank v. Radjord, 295 U. S. 555, various subsections, including (s), were amended by the new Frazier-Lemke Act, August 28, 1935, c. 792, 49 Stat. 942. 4 Subsection (s) in effect at the institution of this proceeding for the relief of a debtor was held unconstitutional in Louisville Joint Stock Land Bank v. Radjord, 295 U. S. 555. The new subsection (s) was approved in Wright N. Vinton Branch, 300 U. S. 440. 5 Subsection (o) of § 75 (which has ne ver been amended) pro vides: “(o) Except upon pétition made to and granted by the judge after hearing and report by the conciliation commissioner, the fol-lowing proceedings shall not be instituted, or if instituted at any time prior to the filing of a pétition under this section, shall not be maintained, in any court or otherwise, against the farmer or his property, at any time after the filing of the pétition under this section, and prior to the confirmation or other disposition of the composition or extension proposai by the court: “(1) Proceedings for any demand, debt, or account, including any money demand; 356 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. judicial discrétion as to enforcement of claims does not take property without due process and is constitutional. Continental Illinois Nat. Bank & T. Co. v. Chicago, R. I. & P. Ry. Co., supra, at pages 675 et seq. and 680 et seq.; Wright v. Vinton Branch, supra, 460; Home Bldg. & Loan Assn. v. Blaisdell, 290 U. S. 398. In order to operate and protect the property during the stay, and pending confirmation or other disposition of the composition or extension proposai, the statute provides in subsections (e) and (n)6 for the exercise by the court of “such control “(2) Proceedings for foreclosure of a mortgage on land, or for cancellation, rescission, or spécifie performance of an agreement for sale of land or for recovery of possession of land; “(3) Proceedings to acquire title to land by virtue of any tax sale; “ (4) Proceedings by way of execution, of attachaient,or gamishment; “(5) Proceedings to sell land under or in satisfaction of any judgment or mechanic’s lien; and “(6) Seizure, distress, sale, or other proceedings under an execution or under any lease, lien, chattel mortgage, conditional sale agreement, crop payment agreement, or mortgage.” 6 These subsections, as originally enacted, read : “(e) . . . After the filing of the pétition and prior to the confirmation or other disposition of the composition or extension proposai by the court, the court shall exercise such control over the property of the farmer as the court deems in the best interests of the farmer and his creditors.” “(n) The filing of a pétition pleading for relief *under this section shall subject the farmer and his property, wherever located, to the exclusive jurisdiction of the court. In proceedings under this section, except as otherwise provided herein, the jurisdiction and powers of the court, the title, powers, and duties of its officers, the duties of the farmer, and the rights and liabilities of creditors, and of ail persons with respect to the property of the farmer and the jurisdiction of the appellate courts, shall be the same as if a voluntary pétition for adjudication had been filed and a decree of adjudication had been entered on the day when the farmer’s pétition or answer was filed.” Subsection (e) has never been amended. Subsection (n) was amended in respects not material here, by the Act of August 28, 1935, c. 792, 49 Stat. 942. ADAIR v. BANK OF AMERICA ASSN. 357 350 Opinion of the Court. over the property of the farmer as the court deems in. the best interests of the farmer and his creditors.” These provisions look toward the maintenance of the farm as a going concern, and afford clear authority, in a proper case, for the continuance of the operations of the farm after the filing of a pétition under § 75 of the Bankruptcy Act. Second. In holding the conciliation commissioner per-sonally liable, we think the lower court misconceived the nature of his office. At the time of filing the original pétition for composition and extension, August 6, 1934, § 75 of the Bankruptcy Act was comprised of subsections (a) to (s) inclusive. Subsections (a) to (r) made provision for conciliation commissioners, set up the same qualifications for eligibility to this office as are required for the office of referee, authorized the conciliation commissioners to receive and transmit the pétitions and schedules, to call the first meeting of creditors, with notice of terms of composition or extension, to hear the parties in interest, to préparé final inventory, to supervise the farmer’s affairs during an extension period and to dis-tribute the considération after a composition. In accordance with § 75, subsection (b), this Court, as of April 24, 1933, established Rule L, governing proceedings under § 75, (a) to (r) inclusive, as an addition to the General Orders in Bankruptcy, 288 U. S. at 641. Rule L provided for reference to the conciliation commissioner, and his carrying out of the duties outlined above. The commissioner was given, in so far as consistent with § 75 and Rule L, “ail the powers and duties of a referee in bankruptcy,” to be carried out under the General Orders in Bankruptcy. Rule L (11). Sections 38 and 39 of the Bankruptcy Act and subsections 3 and 6 of Rule L indi-cate the wide extent of the authority of the conciliation commissioner. Under § 38, Bankruptcy Act, clause four, the referee is empowered to “perform such part of the 358 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. duties, except as to questions arising out of the applications of bankrupts for compositions or discharges, as are by this Act conferred on courts of bankruptcy . . .”7 In view of the foregoing the conciliation commissioner had the authority, prior to the adjudication of bankruptcy under § 75 (s), to act as the “court,” in the first instance and subject to review, in controlling the property of the debtor “in the best interests of the farmer and his creditors.” § 75 (e). In re Wiedmer, 82 F. (2d) 566. Under this authority the conciliation commissioner acted in authorizing the expenditures shown on the ac-count for gathering the crop of 1934, preparing for the crop of 1935, and paying fees and expenses. It is plain that the conciliation commissioner, like the referee (White n. Schloerb, 178 U. S. 542, 546; Mueller v. Nu-gent, 184 U. S. 1, 13) exercises some of the “judicial authority” of the bankruptcy court. The acts just de-tailed were judicial acts. Error within his jurisdiction does not subject him to personal liability. Randall v. Brigham, 7 Wall. 523, 535. See also Bradley v. Fisher, 13 Wall. 335; Alzua v. Johnson, 231 U. S. 106; Yaselli v. Goff, 275 U. S. 503. Cf. First National Bank v. Bonner, 74 F. (2d) 139, 142; United States v. Ward, 257 Fed. 372, 7 “Applications of bankrupts for compositions,” as used in this clause, does not refer to proceedings of debtor for réhabilitation under § 75. And even under § 12, the referee has authority to pro-ceed with steps preliminary to the application for confirmation of the composition proposai. Cf. General Order XII, paragraph 3; In re Bloodworth-Stembridge Co., 178 Fed. 372. Rule 77 of the District Court for the Southern District of California reads as follows: “Rule 77.—Jurisdiction of Referees. It is ordered that the Referees in Bankruptcy of said Court be, and they are hereby vested with jurisdiction in ail bankruptcy cases within the limits of their respective counties, to perform ail the duties conferred on Courts of Bankruptcy, which Referees may be required or authorized to perform; except as otherwise provided by General Order in Bankruptcy No, XII.” ADAIR v. BANK OF AMERICA ASSN. 359 350 Opinion of the Court. 377. This doctrine is quite clear when, as here, no rule or positive enactment was violated and the acts were bona fide. The fact that the proceeds of the crop were banked to the joint account of the debtor and the conciliation com-missioner may hâve obscured the judicial character of the latter. Better practice would suggest that the account appear in the name of the debtor, with the counter-sig-nature of the conciliation commissioner required for with-drawals. Also, at an early, preferably the first, meeting of creditors, the method of handling the business of the debtor pending confirmation or further order should hâve been developed and proper orders entered. Cf. § 12 (a), Bankruptcy Act. This does not appear to hâve been done. These irregularities do not suffice to withdraw from the conciliation commissioner his judicial protection. Alzua v. Johnson, 231 U. S. 106. Some disbursements were made after the adjudication in bankruptcy under subsection (s) and the reference of the proceedings to a referee in bankruptcy. It is un-necessary to décidé whether, under § 75 (s) as originally enacted, the conciliation commissioner could hâve con-tinued to act as referee. In this case, there was no further reference of the proceedings to petitioner, and he continued to act solely at the direction of the referee in bankruptcy. His uncontradicted testimony was as fol-lows: “When this matter was referred to D. W. Richards as referee I wanted him to take the money I had on hand and become the custodian of it. He asked me to keep the money and said he would trust me in the expenditure of the money while it was under him and that he would O. K. the checks, so ail the checks that were written after it went to D. W. Richards were O. K.’d by him and I wrote the checks at his request.” Without determining the effect of the unconstitution-ality of subsection (s) upon the steps taken under its 360 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. authority, it appears that the petitioner acted either ju-dicially, continuing to exercise his powers as conciliation commissioner, or ministerially, as an arm of the court, under the direction and with the approval of the referee. Under the facts of this case we do not think petitioner is personally liable for these disbursements. Cf. First National Bank v. Bonner, 74 F. (2d) 139, 142. Third. Moreover, the expenditures assailed by respondent were proper, at least with respect to the principal items (which are the only ones we shall consider)—the amounts spent in harvesting the 1934 crop, which was sold in order to create the fund, and the amounts spent for préservation of the vineyard and for the cultivation of the 1935 crop. There is no showing that petitioner was improvident. Reference is made in his account to money paid to the farmer as “living expenses,” but the record discloses that the amounts paid the debtor did not exceed the ordinary wages for the work he actually and necessarily performed in the maintenance of the vineyard. Compare Wright v. Vinton Branch, supra, 300 U. S. at 466; In re Barrow, 98 Fed. 582. The court below ruled that under the crop mortgage the farmer had the obligation to cultivate and harvest the crop at his own expense, and therefore the gross pro-ceeds belonged to respondent. This conclusion disregards the fact that the debtor did not harvest the grapes as an ordinary mortgagor. He had corne into court seeking relief under § 75 of the Bankruptcy Act. The filing of his pétition put the property in the control of the court and the harvesting of the crop and the préservation of the property became a matter for the con-cern and action of the court. Respondent certainly cannot complain of the dévotion of the proceeds of the 1934 crop to the cost of harvesting that crop. The care and harvesting of that crop repre-sented the only way to preserve its worth (cf. Union ADAIR v. BANK OF AMERICA ASSN. • 361 350 Opinion of the Court. Trust Co. v. Illinois Midland Ry. Co., 117 U. S. 434, 455), and the cost of protecting a fund in court is every-where recognized as a dominant charge on that fund. See Bronson v. La Crosse R. Co., 1 Wall. 405, 410; Shepherd n. Pepper, 133 U. S. 626, 652; Thompson n. Phénix Ins. Co., 136 U. S. 287, 293; Atlantic Trust Co. v. Chapman, 208 U. S. 360, 376; Wright v. Vinton Branch, supra, 300 U. S. at 468. The rule applies even in ordinary bankruptcy proceedings8 since the secured créditer benefits from the disbursement.9 And since the créditer in this case had a lien on the crop for future years and on the real estate, we cannot say that the money expended for maintenance of the real estate and toward production of the 1935 crop was not likewise for its benefit. Compare Wright N. Vinton Branch, supra, 300 U. S. at 468?0 Respondent itself has 8 Though the court orders a sale free of liens without the consent of the lienholder, the cost of preserving the property is deducted before the proceeds are tumed over to him. C. B. Norton Jewelry Co. v. Hinds, 245 Fed. 341, 343; In re N. Y. Æ Phila. Package Co., 225 Fed. 219, 224; In re. Hansen & Birch, 292 Fed. 898, 899; In re Westmoreland, 4 F. (2d) 602, 603; In re Prince & Walker, 131 Fed. 546, 551; In re Davis, 155 Fed. 671, 673. 8 See Virginia Securities Corp. v. Patrick Orchards, 20 F. (2d) 78, 81; C. B. Norton Jewelry Co. v. Hinds, 245 Fed. 341, 343; In re Prince & Walker, 131 Fed. 541, 546. 10 The Court said: “(c) The disposition of the rental required to be made is said to involve déniai of the mortgagee’s rights. Paragraph 2 provides: “ ‘Such rental shall be paid into court, to be used, first, for pay-ment of taxes and upkeep of the property, and the remainder to be distributed among the secured and unsecured creditors, and àpplied on their daims, as their interests may appear? “It is suggested that payment of taxes and keeping the property in repair takes the income from the mortgagee, and that the mort-gagor alone may be benefited thereby; that if the mortgagor exercises the option to purchase the property at its appraised value, he will secure the property free of tax liens which otherwise might hâve accrued against it. But it must be assumed that the mortgagor 362 OCTOBER TERM, 1937. Syllabus. 303 U. S. suggested, in another connection (see Bank of America National Trust & S. Assn. v. Cuccia, supra), that the grape vines require “cultivation, pruning and care,” lest they “deteriorate.” It is unnecessary to détermine the effect of an expenditure of the proceeds of a crop where the mortgagee has no lien on the property preserved and protected by the expenditures. The decree is reversed and the cause remanded for fur-ther proceedings in conformity with this opinion. Reversed. Mr. Justice McReynolds concurs in the resuit. Mr. Justice Cardozo took no part in the considération or decision of this case. HELVERING, COMMISSIONER OF INTERNAL REVENUE, v. BANKLINE OIL CO.* CERTIORARI TO THE CIRCUIT COURT OF APPEALS FOR THE NINTH CIRCUIT. No. 387. Argued February 9, 1938.—Decided March 7, 1938. 1. The déduction for déplétion in the taxation of profits from oil and gas wells is allowed as an act of grâce, in récognition of the fact that minerai deposits are wasting assets, and is intended as compensation to the owner for the part used up in production. P. 366. will not get the property for less than its actual value. The Act provides that upon the creditor’s request the property must be reappraised, or sold at public auction; and the mortgagee may by bidding at such sale fully protect his interest. Non-payment of taxes may imperil the title. Payments for upkeep are essential to the préservation of the property. These payments prescribed by the Act are in accordance with the common practice in foreclosure proceedings where the property is in the hands of receivers.” * Together with No. 388, Bankline Oil Co. v. Commissioner of Internai Revenue, also on writ of certiorari to the Circuit Court of Appeals for the Ninth Circuit, HELVERING v. BANKLINE OIL CO. 363 362 Syllabus. 2. Making the déduction arbitrary—a per cent, of gross income from the property—was for convenience and did not alter the funda-mental theory of the déplétion allowance. P. 367. 3. The allowance of a per cent, “of the gross income from the property,” i. e. income from oil and gas, is made to the récipients of the gross income by reason of their capital investment in the oil and gas in place. Id. 4. A mere processor who dérivés an économie advantage through contracts with producers of oil or gas but who has no capital investment in the minerai deposit, has not such an “économie interest” in the oil or gas in place that he may hâve an allowance for their déplétion. Id. 5. The Revenue Acts of 1926 and 1928 provide that in computing net income there shall, in the case of oil and gas wells, be an allowance for déplétion of “27^4 per centum of the gross income from the property during the taxable year.” The taxpayer, a corporation, derived income from the sale of gasoline which it extracted from “wet” (natural) gas obtained under contracts with producers. The contract in each case required the taxpayer to lay a pipeline from the well to its plant, connecting the pipe with the casing-head or gas trap at the mouth of the well; it required the producer to deliver into the pipeline, at the casing-head or trap, the gas produced at the well; and required the taxpayer to extract the gasoline from the gas so delivered and to pay the producer a specified share of the gross proceeds of its sale or a specified share of the gasoline. Held, that the taxpayer was not entitled to an allowance for déplétion, since it had no interest in the wells or in the “wet” gas in place, and took no part in the production of it. Pp. 364-367. The taxpayer had the right to hâve the gas delivered, but did not produce it and could not compel its production. The pipelines and equipment, which it provided, facilitated the de-livery of the gas produced, but the agreement for their installation granted no interest in the gas in place. Nor was such an interest created by the provision for payment for the gas delivered, whether the payment was made in money out of the proceeds of the gasoline extracted or by delivery of the agreed portion of the gasoline. Whether or not the “wet” gas had a market value and, if it had, whether tjiat value was greater than the amount paid for it, is in no sense determinative. The taxpayer was still a processor, paying for what it received at the well’s mouth. 364 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. 6. Where a State leases its land to a private party for extraction of oil and gas, reserving a royalty, a fédéral tax on the lessee’s profits from the operations is not invalid as an unconstitutional burden on a state instrumentality. Bumet v. Jergins Trust, 288 U. S. 508. P. 369. See Helvering v. Mountain Producers Corp., post, p. 376. 90 F. 2d 899, reversed in part; affirmed in part. Certiorari, 302 U. S. 675, on two pétitions, directed to different rulings made in the court below upon review of decisions of the board of Tax Appeals, 33 B. T. A. 910. Assistant Solicitor General Bell, with whom Solicitor General Reed, Assistant Attorney General Morris, and Messrs. Sewall Key, A. F. Prescott, and Warner W. Gardner were on the briefs, for the Commissioner. Mr. Martin J. Weil, with whom Mr. A. L. Weil was on the briefs, for the Bankline Oil Company. Mr. Chief Justice Hughes delivered the opinion of the Court. No. 387.—This case présents the question whether respondent, the Bankline Oil Company, is entitled to an allowance for déplétion with respect to gas produced from certain oil and gas wells. The ruling of the Board of Tax Appeals that the taxpayer had no depletable interest (33 B. T. A. 910) was reversed by the Circuit Court of Appeals. 90 F. (2d) 899. Because of an asserted con-flict with the principles applicable under the decisions of this Court, we granted certiorari. Respondent in the years 1927 to 1930 opérâted a casing-head gasoline plant in the Signal Hill Oil Field, Los Angeles County, California. Respondent had entered into contracts with oil producers for the treatment of wet gas by the extraction of gasoline. The Board of Tax Appeals made the following findings: HELVERING v. BANKLINE OIL CO. 365 362 Opinion of the Court. Natural gas, commonly known as “wet gas” as it flows from the earth, is not a salable commodity. It is only through processing—by séparation of the gasoline there-from—rendering it dry, that it may be sold for commercial uses. Conversely, it is only through the séparation of dry gas from wet gas that the gasoline is salable. It is this process that produces casinghead gasoline. The content of gasoline in wet gas varies from one-half gallon to six gallons a thousand cubic feet of gas produced, dépend-ing upon its richness. Respondent’s contracts provided, generally, that it should install and maintain the neces-sary pipe lines and connections from casingheads or traps at the mouth of the well to its plant, through which the producer agreed to deliver the natural gas produced at the well, and that respondent should extract the gasoline therefrom, respondent to pay the producer 33% per cent, of the total gross proceeds derived from the sale of gasoline extracted from wet gas, or, at producer’s option, to deliver to the producer 33% per cent, of the salable gasoline so extracted. A slightly different type of contract provided for the outright “purchase” from the producer of ail natural gas produced at a given well, the respondent paying 33% per cent, of the gross proceeds received by it from the sale of the gasoline extracted from such gas. Some of the dry gas remaining after removal of the gasoline was blown to the air and wasted because there was no market for it, while some was sold to public utilities, and in that case respondent accounted to the producer for a proportion of the proceeds provided for under the contract, and some was returned to the wells to be used for pressure purposes. The Government maintains that under the contracts respondent took no part in the production of the wet gas, conducted no drilling operations upon any of the produc-ing premises, did not pump oil or gas from the wells, and 366 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. had no interest as lessor or lessee, or as sub-lessor or sub-lessee, in any of the producing wells. Respondent States that in accordance with the provisions of the contracts it attached pipe lines to the varions wells, carried the gas from those wells to its plant, where the gas from the wells of the different producers was commingled, and removed the gasoline therefrom. The gasoline was sold and respondent accounted to each producer “for one-third of the proceeds of the producer’s pro rata of the gasoline made.” Respondent contends that it was entitled to deduct for déplétion 27^2 per cent, of the différence between the price which it paid for the wet gas and its fair market value at the mouths of the wells. Respondent took the “prevailing royalty,” which it deemed to be established by the evidence, as that market value, and treated the différence between the amount respondent paid and the greater prevailing royalty as respondent’s gross income for the purpose of applying the statute. Revenue Acts of 1926, § 204 (c) (2), § 234 (a) (8); 1928, § 23 (1) (m), § 114 (b) (3). The Circuit Court of Appeals was of the opinion that respondent had acquired an économie interest in the wet gas in place and was entitled to an allowance for déplétion. But as no finding had been made of the market value of the wet gas, or of respondent’s net income from the property, the court remanded the case to the Board of Tax Appeals to the end that respondent might supplément its proof and that an allowance for déplétion should be made in accordance with the evidence pro-duced. In order to détermine whether respondent is entitled to déplétion with respect to the production in question, we must recur to the fundamental purpose of the statutory allowance. The déduction is permitted as an act of grâce. It is permitted in récognition of the fact that the minerai deposits are wasting assets and is intended as compensation to the owner for the part used up in production. HELVERING v. BANKLINE OIL CO. 367 362 Opinion of the Court. United States v. Ludey, 274 U. S. 295, 302. The granting of an arbitrary déduction, in the case of oil and gas wells, of a percentage of gross income was in the interest of con-venience and in no way altered the fundamental theory of the allowance. United States v. Dakota-Montana Oil Co., 288 U. S. 459, 467. The percentage is “of the gross income from the property,”—a phrase which “points only to the gross income from oil and gas.” Helvering v. Twin Bell Syndicale, 293 U. S. 312, 321. The allowance is to the récipients of this gross income by reason of their capital investment in the oil or gas in place. Palmer v. Bender, 287 U. S. 551, 557. It is true that the right to the déplétion allowance does not dépend upon any “particular form of legal interest in the minerai content of the land.” We hâve said, with reference to oil wells, that it is enough if one “has an économie interest in the oil, in place, which is depleted by production”; that “the language of the statute is broad enough to provide, at least, for every case in which the taxpayer has acquired, by investment, any interest in the oil in place, and secures, by any form of legal rela-tionship, income derived from the extraction of the oil, to which he must look for a return of his capital.” ' Palmer v. Bender, supra. But the phrase “économie interest” is not to be taken as embracing a mere économie advantage derived from production, through a contractual relation to the owner, by one who has no capital investment in the minerai deposit. See Thomas v. Perkins, 301 U. S. 655, 661. It is plain that, apart from its contracts with produc-ers, respondent had no interest in the producing wells or in the wet gas in place. Respondent is a processor. It was not engaged in production. Under its contracts with producers, respondent was entitled to a delivery of the gas produced at the wells, and to extract gasoline there-from, and was bound to pay to the producers the stipu-lated amounts. Some of the contracts, reciting that the 368 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. producer was the owner of the gas produced, provided for its treatment by respondent. Other contracts were couched in terms of purchase. In either case the gas was to be delivered to respondent at the casingheads or gas traps installed by the producer. Respondent had the right to hâve the gas delivered, but did not produce it and could not compel its production. The pipe lines and equipment, which respondent provided, facilitated the delivery of the gas produced but the agreement for their installation granted no interest in the gas in place. Nor was such an interest created by the provision for pay-ment for the gas delivered, whether the payment was made in money out of the proceeds of the gasoline ex-tracted or by delivery of the agreed portion of the gasoline. Whether or not the wet gas had a market value and, if it had, whether that value was greater than the amount respondent paid, is in no sense determinative. Respondent was still a processor, paying for what it received at the well’s mouth. As the Board of Tax Appeals said: “It is safe to say, we believe, that this petitioner [respondent] had no enforceable rights whatso-ever under its contracts prior to the time the wet gas was actually placed in its pipe line, i. e., after it had passed beyond the casingheads and gas traps supplied by the producer into the pipe line, except the right, per-haps, to demand that the producer deliver whatever was produced through its pipe lines for treatment during the period of contractual relationship.” Undoubtedly, respondent through its contracts ob-tained an économie advantage from the production of the gas, but that is not sufficient. The controlling fact is that respondent had no interest in the gas in place. Respondent had no capital investment in thé minerai de-posit which sufïered déplétion and is not entitled to the statutory allowance. HELVERING v. BANKLINE OIL CO. 369 362 Opinion of the Court. The judgment of the Circuit Court of Appeals in this relation is reversed and the decision of the Board of Tax Appeals is affirmed. No. 388.—In 1929, the State of California leased to J. H. Barneson oil and gas lands in Santa Barbara County, reserving a royalty. We assume, for the purposes of this case, as it was assumed below, that the lease was of tide-lands owned by the State. Barneson acted on behalf of petitioner, the Bankline Oil Company, in obtaining the lease, which was duly assigned to petitioner and approved by the State. Claiming that the income received from operations under the lease was exempt from the fédéral income tax, upon the ground that such a tax would con-stitute an unconstitutional burden upon a state instru-mentality, petitioner sought to recover the tax paid for the year 1930. The Circuit Court of Appeals, affirming the decision of the Board of Tax Appeals (33 B. T. A. 910), overruled petitioner’s contention. 90 F. (2d) 899. In view of the importance of the question, certiorari was granted. We are of opinion that the decision of the Circuit Court of Appeals was right. As petitioner was engaged in its own business in producing the oil, it was bound to pay a fédéral income tax upon its profits even though its operations were conducted on state lands. We are unable to find any substantial distinction between the instant case and that of Burnet v. Jergins Trust, 288 U. S. 508, where the city of Long Beach, California, made an oil and gas lease to a private party covering part of a tract owned by the city, the proceeds of the oil and gas sales being divided between the city and the lessee. The claim of immunity by the lessee as an instrumentality of the State, acting through the city, was held to be untenable. So far as the case of Burnet n. Coronado Oil & Gas Co., 285 U. S. 393, which was distinguished in Burnet v. Jergins Trust, supra, may be regarded as supporting a dif-53383°—38------24 370 OCTOBER TERM, 1937. Counsel for Parties. 303 U. S. ferent view, it is disapproved. See Helvering v. Mountain Producers Corp., post, p. 376. The judgment of the Circuit Court of Appeals with respect to petitioner’s income from the lease is affirmed. Judgment in No. 387 reversed; in No. 388 affirmed. Mr. Justice McReynolds and Mr. Justice Butler concur in the resuit. Mr. Justice Cardozo and Mr. Justice Reed took no part in the considération and decision of this case. HELVERING, COMMISSIONER OF INTERNAL REVENUE, v. O’DONNELL. CERTIORARI TO THE CIRCUIT COURT OF APPEALS FOR THE NINTH CIRCUIT. No. 406. Argued February 9, 10, 1938.—Decided March 7, 1938. A shareholder in a corporation owning oil properties has no interest in the oil and gas in place—no capital investment—which will entitle him to an allowance for déplétion under Revenue Act of 1926, §§ 204 (c) (2), 214 (a) (9); nor, upon sale of his shares to one who acquires the wells from the corporation, does he acquire such depletable interest through the vendee’s covenant to pay him a portion of the net profits from development and operation of the properties. P. —. 90 F. 2d 907, reversed. Certiorari, 302 U. S. 676, to review the afiirmance of a decision of the Board of Tax Appeals, 32 B. T. A. 1277, which overruled a deficiency income tax assessment. Assistant Solicitor General Bell, with whom Soliciter General Reed, Assistant Attorney General Morris, and Messrs. Sewall Key and A. F. Prescott were on the brief, for petitioner. Mr. A. Calder Mackay, with whom Mr. Thomas R. Dempsey was on the brief, for respondent. HELVERING v. O’DONNELL. 371 370 Opinion of the Court. Mr. Chief Justice Hughes delivered the opinion of the Court. Respondent, Thomas A. O’Donnell, owned one-third of the capital stock of the San Gabriel Petroleum Company. By contract of January 9, 1918, he sold this stock to the Petroleum Midway Company, Ltd. As considération, the Midway Company agreed to pay to respondent one-third of the net profits from the development and operation of the oil and gas properties then owned by the San Gabriel Company and which the Midway Company agreed to acquire. That acquisition was made, the properties thus acquired were developed and operated, and one-third of the net profits thus derived were paid to respondent to August 4, 1926. With respect to such payments in the years 1925 and 1926, respondent claimed déduction for déplétion, which the Board of Tax Appeals allowed, overruling the Commissioner of Internai Revenue. 32 B. T. A. 1277. The Circuit Court of Appeals afiirmed the decision of the Board. 90 F. (2d) 907. We granted certiorari. See Helvering N. Bankline Oil Co., ante, p. 362. The question is whether respondent had an interest, that is, a capital investment, in the oil and gas in place. Revenue Act of 1926, § 204 (c) (2) ; § 214 (a) (9). Palmer v. Bender, 287 U. S. 551, 557; Helvering v. Twin Bell Syndicale, 293 U. S. 312, 321; Thomas v. Perkins, 301 U. S. 655, 661 ; Helvering v. Bankline Oil Co., supra. As a mere owner of shares in the San Gabriel Company, respondent had no such interest. Treasury Régulations No. 69, Art. 201. The ownership of the oil and gas properties was in the corporation. When the Midway Company acquired these properties from the San Gabriel Company and operated them, the Midway Company became the owner of the oil and gas produced. It was the owner of the gross proceeds or income upon which the statutory allowance for déplétion was to be computed. 372 OCTOBER TERM, 1937. SyUabus. 303 U. S. Helvering v. Twin Bell Syndicale, supra. The agreement to pay respondent one-third of the net profits derived from the development and operation of the prop-erties was a personal covenant and did not purport to grant respondent an interest in the properties themselves. If there were no net profits, nothing would be payable to him. No trust was declared by which respondent could claim an équitable interest in the res. As considération for the sale of his stock in the San Gabriel Company respondent bargained for and obtained an économie ad-vantage from the Midway Company’s operations but that advantage or profit did not constitute a depletable interest in the oil and gas in place. Palmer v. Bender, supra; Helvering v. Bankline Oil Co., supra. The judgment of the Circuit Court of Appeals is reversed and the cause is remanded for further proceedings in conformity with this opinion. Reversed. Mr. Justice Cardozo and Mr. Justice Reed took no part in the considération and decision of this case. HELVERING, COMMISSIONER OF INTERNAL REVENUE, v. ELBE OIL LAND DEVELOPMENT CO. CERTIORARI TO THE CIRCUIT COURT OF APPEALS FOR THE NINTH CIRCUIT. No. 446. Argued February 10, 1938.—Decided March 7, 1938. The taxpayer sold ail of its interest in certain oil and gas properties in considération of cash down and deferred payments in several stated amounts, the agreement further providing that, when the vendee had been reimbursed for expenditures in acquisition, development and operation, the taxpayer should receive one-third of the net profits of production and operation of the properties. Held: HELVERING v. ELBE OIL LAND CO. 373 372 Opinion of the Court. 1. That there was an absolute sale divesting the taxpayer of ail interest or investment in the properties, including oil and gas in place. P. 375. 2. The provision for payment from profits was merely a Personal covenant of the vendee. Id. 3. The taxpayer is not entitled under the Revenue Act of 1928, § 114 (b) (3) to a déduction for déplétion computed on the cash payments. Id. Neither the cash payments nor the agreement for a share of subséquent profits constituted an advance royalty, or a “bonus” in the nature of an advance royalty, within the decisions recog-nizing a right to the déplétion allowance with respect to payments of that sort. 4. The words “gross income from the property,” as used in the statute goveming the allowance for déplétion, mean gross income received from the operation of the oil and gas wells by one who has a capital investment therein,—not income from the sale of the oil and gas properties themselves. P. 375. 91 F. 2d 127, reversed. Certiorari, 302 U. S. 677, to review the reversai of a decision of the Board of Tax Appeals, 34 B. T. A. 333, sustaining the Commissioner’s disallowance of déductions for déplétion. Assistant Soliciter General Bell, with whom Soliciter General Reed, Assistant Attorney General Morris, and Messrs. Sewall Key and Ellis N. Slack were on the brief, for petitioner. Mr. George T. Altman for respondent. Mr. Chief Justice Hughes delivered the opinion of the Court. The question is whether certain payments received by respondent in the years 1928 and 1929 constituted “gross income from the property,” within the meaning of that phrase as used in relation to oil and gas wells in § 114 (b) (3) of the Revenue Act of 1928, so as to entitle respondent to the prescribed déplétion allowance. The Cir- 374 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. cuit Court of Appeals, reversing the decision of the Board of Tax Appeals (34 B. T. A. 333), sustained respondent’s claim. 91 F. (2d) 127. Certiorari was granted because of an asserted conflict with the decision of the Circuit Court of Appeals for the Fifth Circuit in Commissioner v. Fleming, 82 F. (2d) 324. Respondent is a California corporation which acquired certain properties consisting of oil and gas prospecting permits, drilling agreements, leases and equipment. Development work resulted in the discovery of oil. On October 3, 1927, respondent conveyed ail its right, title and interest in the described properties to the Honolulu Consolidated Oil Company. The latter agreed to pay to respondent $350,000 upon the execution of the agreement and, if the Honolulu Company should not elect to abandon the purchase (in accordance with one of the stipulations), the additional sums of $400,000 in each of the years 1928,1929 and 1930, and the further sum of $450,000 in 1931. After the time when the Honolulu Company had been fully reimbursed as provided in the agreement for ail its expenditures in the acquisition, development and operation of the properties, respondent was to receive monthly one-third of the net profits resulting from the production and operation. After careful stipulations with respect to such reimbursement and the computation of net profits, the agreement provided: “Anything in this agreement contained to the contrary notwithstanding, it is the intention of the parties to this agreement that the full ownership, possession and control of ail the properties, the subject of this agreement, and of ail of the Personal property acquired and/or used on and in connection with the operation and development of the properties, the subject of this agreement, shall be vested in Honolulu, and Elbe shall hâve no interest in or to said properties or in or to any personal property used on or in connection with the operation or development of the said properties or in or to the salvage value of any thereof, HELVERING v. ELBE OIL LAND CO. 375 372 Opinion of the Court. except as provided by paragraph 9” [relating to abandon-ment of the purchase and reconveyance]. The first payment of $350,000 was received by respondent in 1927 and being greater than the cost of ail the properties transferred, respondent reported as taxable income the différence between that cost basis and the amount received. In its income tax returns for the years 1928 and 1929, respondent reported the payments of $400,000 received in each of the years and claimed 27^ per cent, thereof as an allowance for déplétion. This is the claim which has been sustained below. We agréé with the conclusion of the Board of Tax Ap-peals that the contract between the respondent and the Honolulu Company provided for an absolute sale of ail the properties in question, including ail the oil and gas in place, and that respondent did not retain any interest or investment therein. The aggregate sum of $2,000,000 was paid as an agreed purchase price to which was to be added the one-third of the net profits payable on the conditions specified. We are unable to conclude that the provision for this additional payment qualified in any way the effect of the transaction as an absolute sale or was other than a personal covenant of the Honolulu Company. See Helvering v. O’Donnell, ante, p. 370. In this view, neither the cash payments nor the agreement for a share of subséquent profits constituted an advance royalty, or a “bonus” in the nature of an advance roy-alty, within the decisions recognizing a right to the déplétion allowance with respect to payments of that sort. Such payments are made to the récipient as a return upon his capital investment in the oil or gas in place. See Burnet v. Harmel, 287 U. S. 103, 111, 112; Murphy Oïl Co. N. Burnet, 287 U. S. 299, 302. Payments of the purchase price which are received upon a sale of oil and gas properties are in a different category. The words “gross income from the property,” as used in the statute governing the allowance for déplétion, mean gross in- 376 OCTOBER TERM, 1937. Syllabus. 303 U. S. corne received from the operation of the oil and gas wells by one who has a capital investment therein,—not in-come from the sale of the oil and gas properties them-selves. See Darby-Lynde Co. v. Alexander, 51 F. (2d) 56, 59. We conclude that as respondent disposed of the properties, retaining no investment therein, it was not entitled to make the déduction claimed for déplétion. Palmer v. Bender, 287 U. S. 551, 557 ; Helvering v. Twin Bell Syndicale, 293 U. S. 312, 321 ; Thomas v. Perkins, 301 U. S. 655, 661; Helvering v. Bankline Oil Co., ante, p. 362; Helvering v. O’Donnell, supra. The judgment of the Circuit Court of Appeals is reversed and the cause is remanded for further proceedings in conformity with this opinion. Reversed. Mr. Justice Cardozo and Mr. Justice Reed took no part in the considération and decision of this case. HELVERING, COMMISSIONER OF INTERNAL REVENUE, v. MOUNTAIN PRODUCERS CORPORATION. CERTIORARI TO THE CIRCUIT COURT OF APPEALS FOR THE TENTH CIRCUIT. No. 600. Argued February 10, 1938.—Decided March 7, 1938. 1. The allowance for déplétion in the case of oil and gas wells is fixed by Rev. Act 1926, § 204 (2), arbitrarily at a specified per cent, of the “gross income from the property,” for convenience of administration; the allowance is an act of grâce; the rule pre-scribed can not be varied to suit particular equities; the term “gross income from the property,” means gross income from the oil and gas, and must be taken in its natural sense,—such income may be more or less than market value according to the bearing of particular contracta. P. 381, 376 HELVERING v. PRODUCERS CORP. 377 Statement of the Case. 2. The Rev. Act of 1926 provides that in the case of oil and gas wells “the allowance for déplétion shall be 27^ per centum of the gross income from the property during the taxable year.” The taxpayer, a corporation owning oil and gas properties, made a contract with a refining company pursuant to which, until a day specified, ail the oil produced by the taxpayer was sold to the re-finer at prices based on the average price received by the refîner for gasoline and kerosene, the refîner taking delivery from meas-uring tanks near the wells. As part of the price of the oil purchased, the refîner agreed to conduct the production operations. Held that the taxpayer’s “gross income from the property” was the sum of the payments received from the refîner without adding the cost of production defrayed by the refîner under the contract. P. 378. 3. A school section, part of the land granted by the United States to the State of Wyoming for educational purposes by the Ena-bling Act of July 10, 1890, 26 Stat. 222, 223, was leased by the State to a private corporation for production of oil and gas, the State reserving a royalty. The Enabling Act provides that the proceeds of the land shall constitute a permanent school fund, and authorizes the State to lease for not more than five years. The lessee executed a déclaration of trust, that it held an undi-vided 50% of the lease and its net proceeds for the benefit of the taxpayer in this case. Held: (1) That, as respects the power of the Fédéral Government to tax income from the lease, no distinction can be made between the income received by the lessee and the income received by the cestui que trust. Pp. 382-383. (2) A fédéral tax on such income is not subject tQ constitutional objection as a tax upon an instrumentality of the State and as constituting a direct and substantial interférence with the execution of the trust assumed by the State under the Enabling Act. Pp. 383-387. Burnet v. Coronado OU & Gas Co., 285 U. S. 393 and Gülespie v. Oklahoma, 257 U. S. 501, overruled. 92 F. 2d 78, reversed. Certiorari, 302 U. S. 681, to review the reversai of a decision of the Board of Tax Appeals, 34 B. T. A. 409, which afîirmed, in reduced amount, a deficiency assess-ment. 378 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. Assistant Soliciter General Bell, with whom Soliciter General Reed, Assistant Attorney General Morris, and Messrs. Sewall Key, Maurice J. Mahoney, Warner W. Gardner, and Edward J. Ennis were on the brief, for petitioner. Mr. Harold D. Roberts, with whom Mr. Randolph E. Paul was on the brief, for respondent. Mr. Chief Justice Hughes delivered the opinion of the Court. Respondent, Mountain Producers Corporation, owned ail the capital stock of the Wyoming Associated Oil Corporation and filed a Consolidated income tax return for the year 1925. Two distinct questions are involved with respect to the taxable income of the above-mentioned affiliate. These are (1) as to the amount of the gross income of the affiliate for the purpose of the statutory allowance for déplétion in the case of oil and gas wells (Revenue Act of 1926, § 204 (c) (2), § 234 (a) (8)); and (2) as to a claim of exemption from taxation of income received by the affiliate under a trust agreement with the owner of an oil and gas lease from the State of Wyoming. The Board of Tax Appeals decided against respondent upon both points (34 B. T. A. 409) and its decision was reversed by the Circuit Court of Appeals. 92 F. (2d) 78. Because of an asserted conflict with a decision of the Circuit Court of Appeals for the Ninth Circuit in the case of Bankline Oil Co. v. Commissioner, 90 F. (2d) 899, (see Helvering v. Bankline Oil Co., ante, p. 362), we granted certiorari. First.—Wyoming Associated, organized in 1919, held certain placer mining claims, leases and operating agree-ments in the Sait Creek Oil Field in Natrona County, Wyoming. Pursuant to the Oil and Gas Leasing Act of Congress of February 25, 1920, the company exchanged its placer claims for government leases, and later certain HELVERING v. PRODUCERS CORP. 379 376 Opinion of the Court. exchanges were made with the Midwest Oil Company and the Wyoming Oil Fields Company. In 1923, Wyo-ming Associated made a contract with the Midwest Re-fining Company by which the former agreed to sell to the latter ail the oil produced by it in the Sait Creek Oil Field and the Refining Company agreed to purchase such oil until January, 1934, upon a sliding scale of prices based upon the average price received by the Refining Company for gasoline and kerosene. Wyoming Associated agreed to give the Refining Company free use of ail storage facilities, pipe lines, buildings and equipment, and so much of the oil and gas produced as might be reasonably necessary for production purposes. The Refining Company agreed, as part of the price of the oil thus purchased, to drill, case and maintain ail wells, supply water, install and operate pumps, and conduct ail development and production operations. The Refining Company agreed to take delivery of the purchased oil at the outlet gates of the measuring tanks located at or near the wells. Respondent contended that the gross income of Wyoming Associated from its properties during the taxable year, for the purpose of the statutory allowance for déplétion, consisted of the total cash payments received by Wyoming Associated, plus the cost of production de-frayed by the Refining Company under its contract. The amount of that cost was shown by stipulation. The Board of Tax Appeals limited the gross income of Wyoming Associated to the cash payments received. The Circuit Court of Appeals was of the opinion that the cost of production incurred by the Refining Company should be added in the view that, had Wyoming Associated produced the oil at its own expense, its gross income would hâve been the amount which it received for the oil sold and it would thus hâve obtained in cash the propor-tionate amount which represented the cost of the production. 380 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. Laying emphasis upon the provision of the contract that the Refining Company should perform its services as a part of the purchase price of the oil, respondent contends that it is irrelevant that the Refining Company acted for its own benefit ; that the production and lifting services were performed prior to delivery of the oil, and that the Refining Company was acting as the agent for Wyoming Associated down to the point of delivery and not until then became a vendee; that thus Wyoming Associated did not sell oil under the ground but oil sev-ered from the ground and treated for delivery; that it was not essential for respondent to show that the total price under the contract must be either above or below the market price at any specified time, and that the price as fixed by the contract controlled the dealings and the taxes of the parties. Respondent agréés that an interest in oil or gas or some type of ownership is essential to the right of déduction for déplétion and assumes that no one but Wyoming Associated owned any interest in the oil and gas in place. The Government argues that the cash price received for the oil is the seller’s entire “gross income from the property” where, as in this instance, the oil is purchased under a contract by which a refiner agréés to defray the expense of the development and production operations and to pay a cash price based on the prices it obtains for the products it sells at its refinery; that the oil production operations were conducted by the Refining Company for its own benefit in order to obtain the oil at a price it deemed to be favorable; that the method of de-termining the purchase price under the contract was not related to the field market price of oil but was expressly related to a different basis, which might be greater, that is, to a basis consisting of the current prices obtained by the Refining Company for its gasoline and kerosene; that if the development operations had been unsuccess- HELVERING v. PRODUCERS CORP. 381 376 Opinion of the Court. fui and no oil had been produced, the services of the Refining Company would still hâve been paid for by the owner’s promise to sell at a fixed price whatever oil might be produced, and that this should be taken to be the meaning of the provision that the Refining Company should perform its services as part of the price for oil purchased ; that the owner of oil in place, instead of preparing it for delivery and sale, may prefer to lessen his work, lower his price and thus decrease his gross income from the property, and in such case the services which the buyer may perform are not to be regarded as part of that income. We think that the Government’s argument is sound. The évident purpose of the statutory provision Controls. It is a unique provision to meet a spécial case. Analogies sought to be drawn from other applications of the revenue acts may be delusive and lead us far from the intent of Congress in this instance. Congress has recognized that in fairness there should be compensation to the owner for the exhaustion of the minerai deposits in the course of production. United States v. Ludey, 274 U. S. 295, 302. But to appraise the actual extent of déplétion on the particular facts in relation to each taxpayer would give rise to problems of considérable perplexity and would create administrative difficulties which it was intended to overcome by laying down a simple rule which could be easily applied. To this end, the taxpayer was per-mitted to deduct a specified percentage of his gross income from the property. See United States v. Dakota-Montana Oil Co., 288 U. S. 459, 461. Congress was free to give such an arbitrary allowance as the déduction was an act of grâce. In answer to the contention that the provision may produce “unjtist and unequal results,” we hâve remarked that this is likely to be so “wherever a rule of thumb is applied without a detailed examination of the facts affecting each taxpayer.” Helvering v. Twin Bell Syndicale, 293 U. S. 312, 321. 382 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. The rule being of this sort for obvions purposes of administrative convenience, we must apply it in the simple manner it contemplâtes. The 27^ Per cent, al-lowed is a fixed factor, not to be increased or lessened by asserted equities. The term “gross income from the property” means gross income from the oil and gas {Helvering v. Twin Bell Syndicale, supra) and the term should be taken in its natural sense. With the motives which lead the taxpayer to be satisfied with the proceeds he receives we are not concerned. If, in this instance, the development operations had failed to produce oil, it would hardly be said that the expense of drilling, borne under contract by another, constituted “gross income” of the taxpayer within the meaning of the statute. Nor, when oil or gas is produced, does the statute base the percentage on market value. The gross income from time to time may be more or less than market value according to the bearing of particular contracts. We do not think that we are at liberty to construct a theoretical gross income by recourse to the expenses of production operations. The Refining Company for its own purposes undertook the expense of those operations, and Wyoming Associated was content to receive as its own return the cash pay-ments for the oil produced, leaving to the Refining Company the risks of production. We are of the opinion that the cash payments made by the Refining Company constituted the gross income of Wyoming Associated and were the basis for the computation of the déplétion allowance. Second.—The State of Wyoming, in 1919, made a lease for the term of five years to the Midwest Oil Company covering a section of “school land” (section 36, town-ship 40 north, range 79 west) for the purpose of produc-ing oil and gas, reserving a royalty to the State. The lease was superseded in 1923 by another lease of like import, running from 1924, the royalty to the State being fixed at 65 per cent, of oil and gas produced. In HELVERING v. PRODUCERS CORP. 383 376 Opinion of the Court. 1923, the Midwest Oil Company executed a déclaration of trust, that it held an undivided 50 per cent, interest in the lease, and in the net proceeds to be realized there-from, and ail renewals thereof, for the benefit of Wyo-ming Associated. In 1925, the State received the agreed royalty of the oil produced and the proceeds of the sale of the remaining oil were divided between Wyoming Associated and the Midwest Oil Company. The question is whether Wyoming Associated is sub-ject to a fédéral income tax with respect to the amount it thus received. Immunity is claimed upon the ground that in this relation Wyoming Associated is a state instrumentality. By the Enabling Act, the land in question was granted to the State of Wyoming for educational purposes, the proceeds to constitute a permanent school fund. Au-thority was given to lease such land for not more than five years. Act of July 10, 1890, c. 664, §§ 4, 5, 26 Stat. 222, 223. Apart from the fact that the claim is made by Wyoming Associated by virtue of the déclaration of trust, and not by the lessee, the case would fall directly within the decision in Burnet v. Coronado Oil & Gas Co., 285 U. S. 393, relating to a fédéral tax upon net income derived by a lessee under a lease of “school lands” by the State of Oklahoma. In Burnet v. Jergins Trust, 288 U. S. 508, we limited the application of the Coronado case, saying that the doctrine invoked was to be applied strictly. But a distinction solely upon the ground that the income in the instant case was received under a déclaration of trust by the lessee, and not by the lessee itself, does not appear to be substantial and we are of the opinion that the Coronado case and the decision upon which it rested should be reconsidered in the light of our other decisions as to the taxing power. The Coronado case was decided as a corollary to the case of Gillespie v. Oklahoma, 257 U. S. 501. The Court there denied to Oklahoma the right to enforce its tax 384 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. upon net income derived by a lessee from sales of his share of oil and gas received under leases of restricted In-dian lands. See Choctaw, O. & G. R. Co. v. Harrison, 235 U. S. 292; Indian Territory Illuminating Oil Co. v. Oklahoma, 240 U. S. 522. As Oklahoma was thus barred from enforcing its tax upon the income of a fédéral lessee of Indian lands, the Court in the Coronado case held that a similar principle should be applied to the enforcement of a fédéral tax upon the income of the State’s lessee of school lands. In such a case, as the State was executing a trust imposed by Congress as a condition of the State’s entering the Union, the cases in which the State had engaged in business enterprises, apart from what should be deemed to be its essential govern-mental functions, were thought to be inapplicable. 285 U. S. p. 400. The ground of the decision in the Gïllespie case, as stated by Mr. Justice Holmes in speaking for the Court, was that “a tax upon the leases” was “a tax upon the power to make them, and could be used to destroy the power to make them” (240 U. S. p. 530) and that a tax “upon the profits of the leases” was “a direct hamper upon the effort of the United States to make the best terms that it can for its wards.” In the light of the expanding needs of State and Nation, the inquiry has been pressed whether this conclusion has adéquate basis ; whether in a case where the tax is not laid upon the leases as such, or upon the govermnent’s property or interest, but is imposed upon the gains of the lessee, like that laid upon others engaged in similar business enterprises, there is in truth such a direct and substantial interférence with the performance of the government’s obligation as to require immunity for the lessee’s income. We hâve held that the ruling in the Gïllespie case should be limited strictly to cases closely analogous (Burnet v. Coronado Oïl & Gas Co., supra), and the distinctions HELVERING v. PRODUCERS CORP. 385 376 Opinion of the Court. thus maintained hâve attenuated its teaching and raised grave doubt as to whether it should longer be supported. In numerous decisions we hâve had occasion to déclaré the competing principle, buttressed by the most cogent considérations, that the power to tax should not be crippled “by extending the constitutional exemption from taxation to those subjects which fall within the general application of non-discriminatory laws, and where no direct burden is laid upon the governmental instru-mentality and there is only remote, if any, influence upon the exercise of the functions of government.” Will-cuts v. Bunn, 282 U. S. 216, 225, and illustrations there cited. Thus we hâve held that the compensation paid by a State or a municipality to a Consulting engineer for work on public projects may be subjected to a fédéral income tax (Metcdlf & Eddy n. Mitchell, 269 U. S. 514, 524) and that the income of independent contractors en-gaged in carrying on government enterprises may be taxed. James v. Dravo Contracting Co., 302 U. S. 134. We hâve always recognized that no constitutional implications prohibit a non-discriminatory tax upon the property of an agent of government merely because it is the property of such an agent and used in the conduct of the agent’s operations and necessary for the agency. McCulloch v. Maryland, 4 Wheat. 316, 436; Railroad Company v. Peniston, 18 Wall. 5, 33; Alward v. Johnson, 282 U. S. 509, 514. The Congress may tax state banks upon the average amount of their deposits, although de-posits of state funds by state officers are included. Manhattan Company n. Blake, 148 U. S. 412. Both the Congress and the States hâve the power to tax transfers or successions in case of death, and this power extends to the taxation by a State of bequests to the United States and to the taxation by the Congress of bequests to States or their municipalities. United States v. Perkins, 163 U. S. 625; Snyder v. Bettman, 190 U. S. 249, 253, 254. 53383°—38-------25 386 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. While a tax on the interest payable on state and municipal bonds has been held to be invalid as a tax bearing directly upon the exercise of the borrowing power of the Government (Weston v. Charleston, 2 Pet. 449, 468, 469; Pollock v. Farmers’ Loan & Trust Co., 157 U. S. 429, 586), the sale of the bonds by their owners after they hâve been issued by the State or municipality is regarded as a transaction distinct from the contracts made by the government in the bonds themselves, and the profits of such sales are subject to the fédéral income tax. Wïll-cuts v. Bunn, supra, p. 227. See, also, Burnet v. Jergins Trust, supra; Helvering v. Therrell, ante, p. 218; and Hél-vering v. Bankline Oïl Co., ante, p. 362. In Group No. 1 Oil Corporation v. Bass, 283 U. S. 279, profits derived by a lessee from the sale of oil and gas produced under a lease from the State of Texas were held not to be immune from fédéral taxation. This decision was distinguished in the Coronado case upon the narrow ground that under the law of Texas the leases effected a présent sale to the lessee of the oil and gas in place. In Indian Territory Oil Co. v. Board of Equalization, 288 U. S. 325, the Court sustained a non-discriminatory ad valorem tax imposed by the State of Oklahoma on oil extracted from restricted Indian lands under leases ap-proved by the Secretary of the Interior, where the oil had been removed from the lands and stored in the owner’s tanks and the Indians had no further interest in it. These decisions in a variety of applications enforce what we deem to be the controlling view—that immunity from non-discriminatory taxation sought by a private person for his property or gains because he is engaged in operations under a government contract or lease can-not be supported by merely theoretical conceptions of interférence with the functions of government. Regard must be had to substance and direct effects. And where HELVERING v. PRODUCERS CORP. 387 376 Butler, J., dissenting. it merely appears that one operating under a government contract or lease is subjected to a tax with respect to his profits on the same basis as others who are engaged in similar businesses, there is no sufficient ground for holding that the effect upon the Government is other than indirect and remote. We are convinced that the rulings in Gillespie v. Oklahoma, supra, and Burnet v. Coronado Oil & Gas Co., supra, are out of harmony with correct principle and accordingly they should be, and they now are, overruled. In the instant case, we find no ground for concluding that the tax upon the profits of Wyoming Associated de-rived under its lease from the State constituted any direct and substantial interférence with the execution of the trust which the State has assumed, and the decision of the Circuit Court of Appeals to the contrary must be reversed. Reversed. Mr. Justice Cardozo and Mr. Justice Reed took no part in the considération and decision of this case. Mr. Justice Butler, dissenting. At least since M’Culloch v. Maryland (1819), 4 Wheat. 316, the dual form of government resulting from the adoption of the Constitution has been deemed necessarily to imply that no State may tax the operations of the Fédéral Government in the exertion of powers that the people delegated to it and that, for the same reason, the Fédéral Government may not tax the operations of any State in the exertion of any of its essential functions of government. As to that principle, the urgency of governmental demand for money does not justify yielding here. No one can foresee the extent to which the decision just announced surrenders it. The transactions of a State 388 OCTOBER TERM, 1937. Butler, J., dissenting. 303 U. S. for the purpose of raising money to provide for schools are admittedly within the principle as heretofore it has been understood and applied. Now this Court makes it lawful for the United States to lay tribute upon them. A few citations will be sufficient to suggest the char-acter of the change so wrought. M’Culloch, v. Maryland held that impliedly the Fédéral Constitution forbade imposition by Maryland of any tax upon the operations of the Bank of the United States within that State. There Chief Justice Marshall, speak-ing for a unanimous Court, demonstrates (p. 426) : “Ist. That a power to create implies a power to preserve. 2nd. That a power to destroy, if wielded by a different hand, is hostile to, and incompatible with these powers to create and to preserve. 3d. That where this repugnancy exists, that authority which is suprême must control, not yield to that over which it is suprême.” Farmers Æ Mechanics Bank n. Minnesota (1914), 232 U. S. 516, held that a State cannot tax bonds issued by a territory of the United States; that a tax upon the bonds is a tax on the government issuing them; that such a tax, if allowed at ail, may be carried to an extent that will entirely arrest governmental operations. The Court rested that decision upon M’Culloch v. Maryland, saying (p. 521) : “The principle has never since been departed from, and has often been reasserted and applied.” 1 Choctaw, O. & G. R. Co. v. Harrison (1914), 235 U. S. 292, held that, where by agreement with an Indian tribe the United States assumed a duty in regard to operation of coal mines, the lessees of the mines were instrumen-talities of the government and could not be subjected to a state occupation or privilège tax.2 1Citing Osborn v. U. S. Bank, 9 Wheat. 738, 859; Home Savings Bank v. Des Moines, 205 U. S. 503, 513; Grether v. Wright, 75 Fed. 742, 753. 2Citing M’Culloch v. Maryland, 4 Wheat. 316; Farmers & Mechanics Bank v. Minnesota, 232 U. S. 516. HELVERING v. PRODUCERS CORP. 389 376 Butler, J., dissenting. Indian Territory Oil Co. v. Oklahoma (1916), 240 U. S. 522, held that oil leases in Oklahoma made by the Osage tribe were under the protection of the Fédéral Government; that the corporation owning the leases was a fédéral instrumentality and that therefore the State could not tax its interest in the leases, either directly or by taxing the capital stock of the corporation owning them.3 Gillespie v. Oklahoma (1922), 257 U. S. 501, held that net income derived from leases like those considered in Choctaw, O. & G. R. Co. v. Harrison, supra, and Indian Territory Oil Co. v, Oklahoma, supra, could not be taxed by the State; for the lessee was an instrumentality used by the United States in fulfilling its duties to the In-dians.4 The Court said (p. 506) : “The same considérations that invalidate a tax upon the leases invalidate a tax upon the profits of the leases, and, stopping short of theoretical possibilities, a tax upon such profits is a direct hamper upon the effort of the United States to make the best terms that it can for its wards.” 3 Citing Choctaw, O. & G. R. Co. v. Harrison, 235 U. S. 292. 4 Citing Choctaw, O. & G. R. Co. v. Harrison, 235 U. S. 292; Indian Territory Oil Co. v. Oklahoma, 240 U. S. 522; Howard v. Gipsy Oil Co., 247 U. S. 503; Large Oil Co. v. Howard, 248 U. S. 549. As to taxability of gains from interstate commerce, see U. S. Glue Co. v. Oak Creek, 247 U. S. 321; Shaffer v. Carter, 252 U. S. 37, 57. In Burnet v. Coronado Oil & Gas Co., 285 U. S. 393, 399, 400, it is stated that Gillespie v. Oklahoma has often been referred to as the expression of an accepted principle, citing Metcalf & Eddy v. Mitchell, 269 U. S. 514, 522; Jaybird Mining Co. v. Weir, 271 U. S. 609, 613; Northwestern Mutual Ins. Co. v. Wisconsin, 275 U. S. 136, 140; Heiner v. Colonial Trust Co., 275 U. S. 232, 234; Shaw v. Gibson-Zahniser Oïl Corp., 276 U. S. 575, 579; Panhandle Oil Co. v. Mississippi ex rel. Knox, 277 U. S. 218, 221, 222; Car-penter v. Shaw, 280 U. S. 363, 366; Willcuts v. Bunn, 282 U. S. 216, 229; Group No. 1 Oil Corp. v. Bass, 283 U. S. 279, 282, 283; Indian Motocycle Co. v. United States, 283 U. S. 570, 576; Choteau v. Burnet, 283 U. S. 691, 696. 390 OCTOBER TERM, 1937. Butler, J., dissenting. 303 U. S. Jaybird Mining Co. v. Weir (1926), 271 U. S. 609, held that where mining land was leased by incompetent Indian owners with the approval of the Secretary of the Interior, in considération of royalty in kind, a state ad valorem tax assessed to lessee on ores in bins on the land, before sale or ségrégation, was void as an attempt to tax an agency of the Fédéral Government.5 In Burnet v. Coronado Oil & Gas Co. (1932), 285 U. S. 393, it appeared that lands granted by the United States to Oklahoma for the support of common schools were leased by the State to a private company for extraction of oil and gas, the State reserving a part of the gross production, the proceeds of which were paid into the school fund. We held that the lease was an instrumentality of the State in the exercise of a strictly governmental func-tion, and that application of the fédéral income tax to the income derived from the lease by the lessee was therefore unconstitutional.6 To reach in this case the conclusion that respondent’s affiliate is subject to fédéral income tax on the proceeds of its share of the oil received under the lease of state school lands, this Court expressly overrules Gillespie v. Oklahoma, supra, and Burnet v. Coronado Oil & Gas Co., supra; and with them necessarily goes a long line of decisions of this and other courts. The opinion brings torward no real reason for so sweeping a change of con- 5 Citing Farmers & Mechanics Bank y. Minnesota, 232 U. S. 516 ; Choctaw, O. & G. R. Co. v. Harrison, 235 U. S. 292; Indian Ter-ritory Oil Co. v. Oklahoma, 240 U. S. 522; Gillespie v. Oklahoma, 257 U. S. 501; Howard v. Gipsy OU Co., 247 U. S. 503; Large OU Co. v. Howard, 248 U. S. 549. 6 Following GUlespie v. Oklahoma, 257 U. S. 501. Citing Texas v. White, 7 Wall. 700, 725; Collecter v. Day, 11 Wall. 113; Pollock v. Farmers Loan & Trust Co., 157 U. S. 429, 584; Farmers & Mechanics Bank n, Minnesota, 232 U. S. 516, 527. HELVERING v. MITCHELL. 391 376 Syllabus. struction of the Constitution. It is to the plain disad-vantage of Indian wards of the National Government and school children of the several States; it threatens many business arrangements that hâve been made for their benefit. I dissent. Mr. Justice McReynolds concurs in this opinion. HELVERING, COMMISSIONER OF INTERNAL REVENUE, v. MITCHELL. CERTIORARI TO THE CIRCUIT COURT OF APPEALS FOR THE SECOND CIRCUIT. No. 324. Argued January 14, 1938.—Decided March 7, 1938. Section 293 (b) of the Revenue Act of 1928, Title I, provides that, if any part of a deficiency is due to fraud with intent to évadé tax, 50% of the total amount of the deficiency (in addition to such deficiency) shall be assessed, collected and paid. Section 146 (b) of the same Title déclarés that any person who wilfully attempts in any manner to évadé or defeat any tax imposed by the Title, shall, in addition to other penalties provided by law, be guilty of a felony and upon conviction be subject to fine and imprisonment. Held: That an acquittai of a charge of wilful attempt to évadé, under § 146 (b), does not bar assessment and collection of the 50% addition prescribed by § 293 (b). P. 397 et seq. The doctrine of res judicata is inapplicable because of the differ-ence in quantum of proof in civil and criminal cases; the acquittai was merely an adjudication that the proof was not sufîicient to overcome ail reasonable doubt of guilt. P. 397. The doctrine of double jeopardy is inapplicable because the 50% addition to tax provided by § 293 (b) is not primarily punitive but is a remédiai sanction imposed as a safeguard for protection of the revenue and to reimburse the Government for expense and loss resulting from the taxpayer’s fraud. As such it may be enforced by a civil procedure to which the accepted rules and 392 OCTOBER TERM, 1937. Argument for Respondent. 303 U. S. constitutional guaranties goveming the trial of criminal prosecu-tions do not apply. P. 398. Cofjee v. United States, 116 U. S. 436, and United States v. La Franca, 282 U. S. 568, distinguished. 89 F. 2d 873, reversed. Certiorari, 302 U. S. 670, to review a judgment revers-ing in part a decision of the Board of Tax Appeals, 32 B. T. A. 1093, which sustained a deficiency income tax assessment, with a 50% addition for fraud. Mr. Edward S. Greenbaum, with whom Soliciter General Reed, Assistant Attorney General Morris, and Messrs. Sewall Key and Lucius A. Buck were on the brief, for petitioner. Mr. William Wallace for respondent. The fifty per centum addition to the tax deficiency is a penalty intended for punishment. As fraud présupposés a plan conceived before its execution, it must of necessity be wilful. There can be no act of fraudulent évasion under § 293 (b) that would not also be a wilful évasion under § 146 (b). The penalty pre-scribed by § 293 (b) is imposed only because of acts which, when committed, constitute a crime. The fact that the words “tax” or “addition to the deficiency” are used to describe the imposition, or that collection is made through the Bureau of Internai Revenue of the Treasury Department, is of no significance if the real purpose of the imposition is to define and suppress a crime. Child Labor Tax Case, 259 U. S. 20; Helwig v. United States, 188 U. S. 605; Dorsheimer N. United States, 7 Wall. 166. Even though termed a tax, the assessment is under suspicion of not being a true tax, when levied because of illégal acts. United States v. La Franca, 282 U. S. 568. If “evidence of a crime is essential to the imposition of 391 HELVERING v. MITCHELL. Argument for Respondent. 393 a tax, the courts do not hesitate to pronounce it a penalty, even if it may incidentally bring in revenue.” Regai Drug Corp. v. Wardell, 260 U. S. 386; Lipke v. Lederer, 269 U. S. 557. Nor does the fact that the penalty may be superimposed on what is clearly a tax lessen the penal character of the former. Helwig N. United States, supra, 614-616; 17 Ops. Atty. Gen. 433; 23 Ops. Atty. Gen. 398. A review of the decisions of this Court compels us to the conclusion that (1) if a so-called tax is meant pri-marily to suppress a certain kind of conduct, rather than to supply regular revenue for the support of the Government, or (2) if the addition is greatly out of proportion to the ordinary tax, or (3) if it is levied upon a particular act because of its fraud, then it is regarded as a penalty and punishment rather than a mere tax. Cases supra, and Passavant v. United States, 148 U. S. 214; Wright v. Blakeslee, 101 U. S. 174; Bartlett v. Kane, 16 How. 263; Moore Shipbuilding Co. v. United States, 50 F. 2d 288. Tayloe v. Sandjord, 7 Wheat. 13, 17; and Stearns v. United States, 22 Fed. Cas. 1188, 1192, dis-tinguished. Ail of the cases above cited which held the addition to be a penalty or punishment were civil in their nature. In ail of them the rules of evidence and of procedure applicable to civil actions were applied, except that the défendant could not be compelled to bear witness against himself. Lees v. United States, 150 U. S. 476, 480; Boyd N. United States, 116 U. S. 616. This application of rules of civil procedure included admissibility of evidence, United States v. Zucker, 161 U. S. 475, also quantum of proof, United States v. Regan, 232 U. S. 37, and direction of verdicts, Hepner v. United States, 213 U. S. 103. The penalties were either assessed by administrative officiais or sued for in a civil action. 394 OCTOBER TERM, 1937. Argument for Respondent. 303 U. S. Despite the fact that the statutory provisions so en-forced were civil in their nature, or at most quasi criminal—this term was applied to them in Boyd v. United States, supra, (p. 634)—they were uniformly held to be penalties, i. e., punishment for wrongful conduct. In none of the cases did the fact of adhérence to the civil forms of action militate against a détermination that the imposition was penal in character. Oceanic Navigation Co. v. Stranahan, 214 U. S. 320, distinguished. Neither the method of collection nor the taxpayer’s inability to invoke the aid of equity to enjoin collection are determinative of the punitive character of such additions. Helwig v. United States, supra; United States v. Chouteau, 102 U. S. 603, 611; Dorsheimer v. United States, supra. In Stockwell v. United States, 13 Wall. 531, no question of double jeopardy was presented nor did the Court by using the word “compensatory” mean to detract from the essentially punitive character of the penalty. The constitutional provisions against double jeopardy bar any présent imposition of the fifty per centum addition to the tax. Boyd v. United States, 116 U. S. 616; Murphy v. United States, 272 U. S. 630; United States v. Warner Brothers Pictures, Inc., 13 F. Supp. 614; United States n. Donaldson-Shultz Co., 148 Fed. 581; United States v. Chouteau, 102 U. S. 603; Coffey v. United States, 116 U. S. 436; Varions Items v. United States, 282 U. S. 577; United States v. Glidden Co., 78 F. 2d 639; 296 U. S. 652. Ail the facts and intents requisite to the imposition of the 50% addition to the deficiency were put in issue and determined against the Government in the criminal trial, and the judgment of acquittai bars petitioner from ob-taining a second judgment based upon the same facts and intents. HELVERING v. MITCHELL. 395 391 Opinion of the Court. Mr. Justice Brandeis delivered the opinion of the Court. Revenue Act of 1928, c. 852, § 293, 45 Stat. 791, provides, in dealing with assessment of deficiencies in income tax returns: “(b) Fraud.—If any part of any deficiency is due to fraud with intent to évadé tax, then 50 per centum of the total amount of the deficiency (in addition to such deficiency) shall be so assessed, collected and paid. . . The question for decision is whether assessment of the addition is barred by the acquittai of the défendant on an indictment under § 146 (b) of the same Act for a wilfull attempt to évadé and defeat the tax. The Commissioner of Internai Revenue found that Charles E. Mitchell of New York had, in his income tax return for the year 1929, fraudulently deducted from admitted gross income an alleged loss of $2,872,305.50 from a purported sale of 18,300 shares of National City Bank stock to his wife; that he had fraudulently failed to return the sum of $666,666.67 received by him as a distribution from the management fund of the National City Company, of which he was chairman; and that these fraudulent acts were done with intent to évadé the tax. On December 8, 1933, the Commissioner notified Mitchell that there was a deficiency in his tax return of $728,709.84 and, on account of the fraud, a 50 per cent, addition thereto in the sum of $364,354.92. Mitchell appealed to the Board of Tax Appeals, which sustained the Commissioner’s détermination. 32 B. T. A. 1093. Upon a pétition for review, the Circuit Court of Appeals concluded that there was ample evidence to support the Board’s findings that Mitchell had fraudulently made déduction of the loss and that he had fraudulently failed to return the amount received from the management fund; and that, despite the facts hereafter stated, 396 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. the Board was free to find the facts according to the evidence. It accordingly affirmed the assessment of the deficiency of $728,709.84. But it reversed the Board’s approval of the additional assessment of $364,354.92, because of the following facts: Before the deficiency assessment was made Mitchell had been indicted in the fédéral court for Southern New York under § 146 (b) of the Revenue Act of 1928, which provides: “Any person . .. who willfully attempts in any manner to évadé or defeat any tax imposed by this title or the payaient thereof, shall, in addition to other penalties pro-vided by law, be guilty of a felony and, upon conviction thereof, be fined not more than $10,000, or imprisoned for not more than 5 years, or both, together with the costs of prosecution.” The first count charged that Mitchell “unlawfully, wil-fully, knowingly, feloniously, and fraudulently did at-tempt to defeat and évadé an income tax of, to wit, $728,709.84, upon his net income for 1929.” He was tried on the indictment and acquitted on ail the counts. The item of $728,709.84 set out in the first count is the same item as that involved in the deficiency assessed; and both arose from the same transactions of Mitchell. But the addition of $364,354.92 by reason of fraud was not involved in the indictment. The Circuit Court of Appeals held that the prior judgment of acquittai was not a bar under the doctrine of res judicata; and hence it affirmed the assessment of the $728,709.84. But it held that our decisions in Coffey v. United States, 116 U. S. 436, and United States v. La Franca, 282 U. S. 568, required it “to treat the imposition of the penalty of 50 per cent, as barred by the prior acquittai of Mitchell in the criminal action.” 89 F. (2d) 873. Mitchell’s pétition for certiorari to review so much of the judgment as upheld the assessment of the de- 391 HELVERING v. MITCHELL. Opinion of the Court. 397 ficiency of $728,709.84 was denied. 302 U. S. 723. The Commissioner’s pétition to review so much of the judgment as denied the 50 per centum in addition was granted, because of the importance in the administration of the revenue laws of the questions presented and al-leged conflict in decisions. 302 U. S. 670. First. Mitchell contends that the claim for the 50 per cent, is barred by the doctrine of res judicata. He as-serts that ail the facts and intents requisite to the imposition of the 50 per centum addition to the deficiency were put in issue and determined against the Government in the criminal trial, and that hence, under the doctrine of res judicata the judgment of acquittai bars it from obtaining a second judgment based upon the same facts and intents. Since this proceeding to détermine whether the amount claimed is payable as a tax is a proceeding different in its nature from the indictment for the crime of wilfully attempting to évadé the tax, the contention that the doctrine of estoppel by judgment ap-plies rests wholly on the assertion that the issues here presented were litigated and determined in the criminal proceeding. Compare Tait v. Western Maryland Ry. Co., 289 U. S. 620, 623. But this is not true. The différence in degree of the burden of proof in criminal and civil cases precludes application of the doctrine of res judicata. The acquittai was “merely ... an adjudication that the proof was not sufficient to overcome ail reasonable doubt of the guilt of the accused.” Lewis n. Frick, 233 U. S. 291, 302. It did not détermine that Mitchell had not wilfully attempted to évadé the tax. That acquittai on a criminal charge is not a bar to a civil action by the Government, remédiai in its nature, arising out of the same facts on which the criminal proceeding was based has long been settled. Stone v. United States, 167 U. S. 178, 188; Murphy v. United States, 272 U. S. 630, 631, 632. Compare Chantangco N. Abaroa, 218 U. S. 398 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. 476, 481, 482.1 Where the objective of the subséquent action likewise is punishment, the acquittai is a bar, because to entertain the second proceeding for punishment would subject the défendant to double jeopardy; and double jeopardy is precluded by the Fifth Amendment whether the verdict was an acquittai or a conviction. Murphy v. United States, 272 U. S. 630, 632. The Government urges that application of the doctrine of res judicata is precluded also by the différence in the issues presented in the two cases; that although the in-dictment and this proceeding arise out of the same transactions and facts, the issues in them are not the same; that on the indictment the issue was whether Mitchell had “willfully” attempted to “évadé or defeat” the tax; that whether he had done so “fraudulently” was not there an issue, United States v. Scharton, 285 U. S. 518; compare United States v. Murdock, 290 U. S. 389, 397 ; and that in this proceeding the issue is specifically whether the deficiency was “due to fraud.” Compare Burton v. United States, 202 U. S. 344, 380. Since there was not even an adjudication that Mitchell did not wilfully at-tempt to évadé or defeat the tax, it is not necessary to décidé whether such an adjudication would be décisive also of this issue of fraud. Compare Hanby N. Commis-sioner, 67 F. (2d) 125, 129. Second. Mitchell contends that this proceeding is barred under the doctrine of double jeopardy because the 50 per centum addition of $364,354.92 is not a tax, but a criminal penalty intended as punishment for allegedly fraudulent acts. Unless this sanction was intended as punishment, so that the proceeding is essentially criminal, 1 United States v. Warner Bros. Pictures, Inc., 13 F. Supp. 614 (E. D. Mo.), affirmed on other grounds, 298 U. S. 643; United States v. Donaldson-Schultz Co., 148 Fed. 581 (C. C. A. 4) ; United States v. Schneider, 35 Fed. 107 (C. C. D. Ore.); Sanden v. Morgan, 225 Fed. 266, 268-69 (S. D. N. Y.) 391 HELVERING v. MITCHELL. Opinion of the Court. 399 the double jeopardy clause provided for the défendant in criminal prosecutions is not applicable. 1. In assessing income taxes the Government relies pri-marily upon the disclosure by the taxpayer of the relevant facts. This disclosure it requires him to make in his annual return. To ensure full and honest disclosure, to discourage fraudulent attempts to évadé the tax, Con-gress imposes sanctions. Such sanctions may confessedly be either criminal or civil. As stated in Oceanic Steam Navigation Co. v. Stranahan, 214 U. S. 320, 339: “In accord with this settled judicial construction, the législation of Congress from the beginning, not only as to tariff but as to internai revenue, taxation and other sub-jects, has proceeded on the conception that it was within the competency of Congress, when legislating as to mat-ters exclusively within its control, to impose appropriate obligations and sanction their enforcement by reasonable money penalties, giving to executive officers the power to enforce such penalties without the necessity of invoking the judicial power.” Congress may impose both a criminal and a civil sanction in respect to the same act or omission ; for the double jeopardy clause prohibits merely punishing twice, or at-tempting a second time to punish criminally, for the same offense. The question for decision is thus whether § 293 (b) imposes a criminal sanction. That question is one of statutory construction. Compare Murphy v. United States, 272 U. S. 630, 632. Remédiai sanctions may be of varying types. One which is characteristically free of the punitive criminal element is révocation of a privilège voluntarily granted.2 2Typical of this class of sanctions is the déportation of aliens. Fong Yue Ting v. United States, 149 U. S. 698; Low Wah Suey v. Backus, 225 U. S. 460; Zakonaite v. Wolj, 226 U. S. 272; Buga-jewitz v. Adams, 228 U. S. 585; Ng Fung Ho v. White, 259 U. S. 276; United States ex rel. Bilokumsky v. Tod, 263 U. S. 149. Die-barment is likewise a sanction of this type. Ex parte Wall, 107 U. S 400 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. Forfeiture of goods or their value and the payment of fixed or variable sums of money are other sanctions which hâve been recognized as enforcible by civil proceedings since the original revenue law of 1789. Act of July 31, 1789, c. 5, § 36, 1 Stat. 29, 47. In spite of their comparative severity, such sanctions hâve been upheld against the contention that they are essentially criminal and sub-ject to the procédural rules governing criminal prosecu-tions. Passavant v. United States, 148 U. S. 214; United States N. Zucker, 161 U. S. 475; Hepner n. United States, 213 U. S. 103; Oceanic Steam Navigation Co. v. Strana-han, 214 U. S. 320; Chicago, B. & Q. Ry. Co. v. United States, 220 U. S. 559, 578; United States v. Regan, 232 U. S. 37; Grant Bros. Construction Co. N. United States, 232 U. S. 647, 660; Murphy v. United States, 272 U. S. 630; Various Items v. United States, 282 U. S. 577; Lloyd Sdbaudo Societa v. Elting, 287 U. S. 329, 334.3 265. Compare also Hawker v. New York, 170 U. S. 189, 196, 199-200; Board of Trade v. Wallace, 67 F. (2d) 402, 407 (C. C. A. 7) ; Farmers’ Livestock Commission Co. v. United States, 54 F. (2d) 375, 378 (E. D. 111.). 3 See also notes 7 to 13, infra. The distinction here taken between sanctions that are remédiai and those that are punitive has not generally been specifically enunciated. In determining whether par-ticular rules of criminal procedure are applicable to civil actions to enforce sanctions, the cases hâve usually attempted to distinguish between the type of procédural rule involved rather than the kind of sanction being enforced. Thus Hepner v. United States, 213 U. S. 103, 111-112, holding that a verdict may be directed for the Government, and United States v. Regan, 232 U. S. 37, 50, holding that the Government need not prove its case beyond a reasonable doubt, distinguished Boyd v. United States, 116 U. S. 616, and Lees v. United States, 150 U. S. 476, holding that the défendant could not be required to be a witness against himself on the ground that “the guaranty in the Fifth Amendment to the Constitution against compulsory self-incrimination . . . is of broader scope than are the guaranties in Article III and the Sixth Amendment governing trials in criminal prosecutions.” 232 U. S. at 50. Compare also Pierce v. United States, 255 U. S. 398, 401. HELVERING v. MITCHELL. 401 391 Opinion of the Court. 2. The remédiai character of sanctions imposing additions to a tax has been made clear by this Court in pass-ing upon similar législation. They are provided pri-marily as a safeguard for the protection of the revenue and to reimburse the Government for the heavy expense of investigation and the loss resulting from the taxpayer’s fraud.4 In Stockwell v. United States, 13 Wall. 531, 547, 551, the Court said of a provision which added double the value of the goods: “It must therefore be considered as remédiai, as pro-viding indemnity for loss. And it is not the less so because the liability of the wrongdoer is measured by double the value of the goods received, concealed, or purchased, instead of their single value. The act of abstracting goods illegally imported, receiving, concealing or buying them, interposes difficulties in the way of a government seiz-ure, and impairs, therefore, the value of the government right. It is, then, hardly accurate to say that the only loss the government can sustain from concealing the goods liable to seizure is their single value, or to assert that the liability imposed by the statute of double the value is arbitrary and without reference to indemnifi-cation. Double the value may not be more than complété indemnity. . . . “The act of 1823 was, as we hâve seen, remédiai in its nature. Its purpose was to secure full compensation for interférence with the rights of the United States. ...”5 3. In §§ 276 and 293 it is provided that collection of the 50 per centum addition, like that of the primary tax it- 4 Taylor v. United States, 3 How. 197, 210; Bartlett v. Kane, 16 How. 263, 274; Cliquot’s Champagne, 3 Wall. 114, 145; Dorsheimer v. United States, 7 Wall. 166, 173; Passavant v. United States, 148 U. S. 214, 221. Compare McDowell v. Heiner, 9 F. (2d) 120 (W. D. Pa.), affirmed on opinion below, 15 F. (2d) 1015 (C. C. A. 3); Doit v. Evans, 7 Fed. Cas. No. 3,969 (C. C. E. D. Pa.) ; Stearns v. United States, 22 Fed. Cas. No. 13,341 (C. C.). 5 Compare United States v. Claflin, 97 U. S. 546, 552-53. 53383°—38---------26 402 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. self, may be made “by distraint” as well as “by a pro-ceeding in court.” If the section provided a criminal sanction, the provision for collection by distraint would make it unconstitutional? Compare Lipke v. Lederer, 259 U. S. 557; Regai Drug Corp. v. Wardell, 260 U. S. 386. See also United States v. Chouteau, 102 U. S. 603, 611; Boyd v. United States, 116 U. S. 616; Lees v. United States, 150 U. S. 476; United States v. La Franca, 282 U. S. 568. That Congress provided a distinctly civil procedure for the collection of the additional 50 per centum indicates clearly that it intended a civil, not a criminal, sanction. Civil procedure is incompatible with the ac-cepted rules and constitutional guaranties governing the trial of criminal prosecutions, and where civil procedure is prescribed for the enforcement of remédiai sanctions, those rules and guaranties do not apply. Thus the détermination of the facts upon which liability is based may be by an administrative agency instead of a jury,7 or if the prescribed proceeding is in the form of a civil suit, 6Even though Congress may not provide civil procedure for the enforcement of punitive sanctions, nothing in the Constitution pre-vents the enforcement of distinctly remédiai sanctions by a criminal instead of a civil form of proceeding. Compare United States v. Stevenson, 215 U. S. 190, with United States v. Regan, 232 U. S. 37, both enforcing the sanction prescribed in 34 Stat. 898. The fact that a criminal procedure is prescribed for the enforcement of a sanction may be an indication that it is intended to be punitive, but cannot be deemed conclusive if alternative enforcement by a civil proceeding is sustained. 7 Passavant v. United States, 148 U. S. 214; Oceanic Steam Navigation Co. v. Stranahan, 214 U. S. 320; Elting v. North Germon Lloyd, 287 U. S. 324, 327-28; Lloyd Sabaudo Societa v. Elting, 287 U. S. 329, 334; cf. Hamburg-American Line v. United States, 291 U. S. 420; Osaka Shosen Kaisha Line v. United States, 300 U. S. 98. Compare also San Souci v. Compagnie Française de Navigation A Vapeur, 71 F. (2d) 651, 653 (C. C. A. 1); Lloyd Royal Belge, S. A. v. Elting, 61 F. (2d) 745, 747 (C. C. A. 2); Navigazione Libéra Triestina v. United States, 36 F. (2d) 631, 633 391 HELVERING v. MITCHELL. Opinion of the Court. 403 a verdict may be directed against the défendant;8 there is no burden upon the Government to prove its case be-yond a reasonable doubt,9 and it may appeal from an adverse decision;10 furthermore, the défendant has no con-stitutional right to be confronted with the witnesses (C. C. A. 9); Clay v. Swope, 38 Fed. 396 (C. C. D. Ky.). And see cases cited in note 2, supra. Administrative détermination of sanctions imposed by the income tax laws has likewise been upheld. Berlin v. Commissioner, 59 F. (2d) 996, 997 (C. C. A. 2); McDowell v. Heiner, 9 F. (2d) 120 (W. D. Pa.), aff’d on opinion below, 15 F. (2d) 1015 (C. C. A. 3); Board v. Commissioner, 51 F. (2d) 73, 76 (C. C. A. 6) ; Wickham v. Commissioner, 65 F. (2d) 527, 531-32 (C. C. A. 8); Little v. Helvering, 75 F. (2d) 436, 439 (C. C. A. 8); Bothwéll v. Commissioner, 77 F. (2d) 35, 38 (C. C. A. 10); DoU v. Evans, Fed. Cas. No. 3,969 (C. C. E. D. Pa.). 3 Hepner v. United States, 213 U. S. 103; Four Packages v. United States, 97 U. S. 404, 412; Chicago, B. & Q. Ry. Co. v. United States, 220 U. S. 559, 578. Compare United States v. Thompson, 41 Fed. 28 (C. C. S. D. N. Y.); United States v. Atlantic Coast Line, 182 Fed. 284 (S. D. Ga.). ® Lilienthal’s Tobacco v. United States, 97 U. S. 237, 265-67, 271 ; United States v. Regan, 232 U. S. 37; Grant Bros. Construction Co. n. United States, 232 U. S. 647, 660. Compare New York Central & H. R. R. Co. v. United States, 165 Fed. 833, 839 (C. C. A. 1); Grain Distillery No. 8 v. United States, 204 Fed. 429 (C. C. A. 4) ; Pocahontas Distilling Co. v. United States, 218 Fed. 782, 786 (C. C. A. 4); United States v. Lôuisville & N. Ry. Co., 162 Fed. 185 (S. D. Ala.), aff’d, 174 Fed. 1021 (C. C. A. 5); St. Louis-S. W. Ry. Co. v. United States, 183 Fed. 770, 771 (C. C. A. 5) ; United States v. Illinois Central R. Co., 170 Fed. 542, 545-546 (C. C. A. 6); Atchison, T. & S. F. Ry. Co. v. United States, 178 Fed. 12, 14 (C. C. A. 8) ; Missouri, K. & T. Ry. Co. v. United States, 178 Fed. 15, 17-18 (C. C. A. 8). Compare also Act of March 2, 1799, c. 22, § 71, 1 Stat. 627, 678; Locke v. United States, 7 Cranch 339, 348; Cliquons Champagne, 3 Wall. 114, 143-44. 10 Compare United States v. Claflin, 97 U. S. 546; United States v. Zucker, 161 U. S. 475; United States v. Regan, 232 U. S. 37. See also United States v. Baltimore & O. S. W. R. Co., 159 Fed. 33, 38 (C. C. A. 6), modified, 220 U. S. 94; United States v. LouisviUe & 404 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. against him,11 or to refuse to testify;12 and finally, in the civil enforcement of a remédiai sanction there can be no double jeopardy.13 4. The fact that the Revenue Act of 1928 contains two separate and distinct provisions imposing sanctions, and that these appear in different parts of the statute, helps to make clear the character of that here invoked.14 The sanction of fine and imprisonment prescribed by § 146 (b) for wilfull attempts “in any manner to évadé or de- N. R. Co., 167 Fed. 306, 307-308 (C. C. A. 6) ; United States v. Illinois Central R. Co., 170 Fed. 542, 545 (C. C. A. 6). Compare United States v. Sanges, 144 U. S. 310. Similarly, if the Government is successful it may recover costs as in other civil suits. Grant Bros. Construction Co. v. United States, 232 U. S. 647, 665. See also United States v. Southern Pacific Co., 172 Fed. 909, 911 (C. C. D. Ore.); United States v. Minneapolis, St. P. & S. S. M. Ry. Co., 235 Fed. 951, 952-953 (D. Minn.). 11 United States v. Zucker, 161 U. S. 475; Grant Bros. Construction Co. v. United States, 232 U. S. 647, 660. 12 Compare United States ex rel. Bilokumsky v. Tod, 263 U. S. 149, 155. We do not construe Boyd v. United States, 116 U. S. 616, or Lees v. United States, 150 U. S. 476, as holding to the contrary where the sanction involved is remédiai, not punitive. See note 3, supra. 13 Murphy v. United States, 272 U. S. 630; Varions Items v. United States, 282 U. S. 577. Compare Egner v. United States, 16 F. (2d) 597 (C. C. A. 3) ; Wood v. United States, 204 Fed. 55, 57 (C. C. A. 4) ; United States v. St. Louis-S. W. Ry. Co., 184 Fed. 28, 32 (C. C. A. 5); Slick v. United States, 1 F. (2d) 897, 898 (C. C. A. 7). See also United States v. Three Copper Stills, 47 Fed. 495, 499 (D. Ky.); United States v. Olsen, 57 Fed. 579, 582-586 (N. D. Cal.) ; Castle v. United States, 17 F. Supp. 515, 518-520 (Ct. Cl.). Compare Hanby v. Commissioner, 67 F. (2d) 125 (C. C. A. 4). 14 The Board of Tax Appeals said in Mitchell v. Commissioner, 32 B. T. A. 1093, 1136: “A careful study of the two sections con-vinces us that they are basically different in character and were enacted for wholly different purposes. The language of the two sections differs widely and contemplâtes situations which may require entirely dissimilar proof.” HELVERING v. MITCHELL. 405 391 Opinion of the Court. feat any [income] tax/’ introduced into the Act under the heading “Penalties,” is obviously a criminal one. The sanction of 50 per centum addition “if any part of any deficiency is due to fraud with intent to évadé tax,” prescribed by § 293 (b), introduced into the Act under the heading “Additions to the Tax,” was clearly intended as a civil one. This sanction, and other additions to the tax, are set forth in Supplément M, entitled “Interest and Additions to the Tax.” The supplément includes, besides § 293 (b), §§ 291, 292, 293 (a) and 294. Section 291 prescribes a 25 per centum addition for failure to make and file a return; § 292 prescribes interest at the rate of 6 per cent, per annum upon the deficiency from the date prescribed for payment of the tax; § 293 (a), an addition of 5 per centum if the deficiency “is due to négligence, or intentional disregard of rules and régulations but without intent to defraud”; and § 294 prescribes an addition to the tax of 1 per centum per month in case of non-payment. Obviously ail of these “Additions to the Tâx” were intended by Congress as civil incidents of the assessment and collection of the income tax.15 Third. Mitchell insists that Cofley n. United States, 116 U. S. 436, requires affirmance of the judgment; the Government argues that this case is distinguishable, and, if not, that it should be disapproved. The Circuit Court of Appeals, citing Stone v. United States, 167 U. S. 178, 186-189, and later cases, recognized that the rule of the Coffey case “did not apply to a situation where there had been an acquittai on a criminal charge followed by a civil action requiring a different degree of proof”; but 15 Section 104 imposes a somewhat similar additional tax of 50 per cent, of the net income in the case of corporations formed or availed of for the purpose of avoiding surtax on their shareholders through improper accumulation of surplus. Compare United Business Corp. v. Commissioner, 62 F. (2d) 754 (C. C. A. 2). 406 OCTOBER TERM, 1937. Syllabus. 303 U. S. construing § 293 (b) as imposing a penalty designed to punish fraudulent tax dodgers “and not as a mere préventive measure,” it thought that the Cofjey case and United States v. La Franca, 282 U. S. 568, required it “to treat the imposition of the penalty of 50 per cent, as barred by the prior acquittai of Mitchell in the criminal action.” Since we construe § 293 (b) as imposing a civil administrative sanction, neither case présents an obstacle to the recovery of the $364,354.92, the 50 per centum addition here in issue. Reversed. Mr. Justice McReynolds is of opinion that the judgment of the Circuit Court of Appeals should be affirmed. Mr. Justice Cardozo and Mr. Justice Reed took no part in the considération or decision of this case. TICONIC NATIONAL BANK et al. v. SPRAGUE et al. CERTIORARI TO THE CIRCUIT COURT OF APPEALS FOR THE FIRST CIRCUIT. No. 374. Argued February 2, 3, 1938.—Decided March 7, 1938. 1. As an incident to the right to recover the amount of a bank deposit, the depositor is entitled to interest as damages for the failure to pay upon demand. P. 410. 2. The obligation of a national bank to pay interest as damages for détention of a debt is not eut off by suspension of its business and appointment of a receiver. P. 410. 3. The rule that in pro rata distribution, to creditors of an insolvent national bank, interest on claims is limited to interest accrued prior to insolvency, does not apply to the claim of a secured credi-tor against the assets covered by his lien. The secured créditer may enforce his lien against his security to satisfy both principal and interest. P. 411. 90 F. 2d 641, affirmed. 406 TICONIC BANK v. SPRAGUE. Opinion of the Court. 407 Certiorari, 302 U. S. 675, to review the affirmance of a decree of the District Court, 14 F. Supp. 900, ordering the receiver of a national bank to make payment to the présent respondents of a sum constituting a trust fund, with interest. Mr. George P. Barse, with whom Messrs. F. Harold Dubord, Trevor V. Roberts, and James Louis Robertson were on the brief, for petitioners. Mr. Harvey D. Eaton for respondents. By leave of Court, Acting Solicitor General Bell, and Messrs. Russell L. Snodgrass and Frederick E. Bauk-hages, III, filed a brief on behalf of the Reconstruction Finance Corporation, as amicus curiae, in support of respondents. Mr. Justice Reed delivered the opinion of the Court. The question for decision is whether or not a secured creditor of a national bank, holding a non-interest bear-ing claim, is entitled to interest for any period subséquent to the insolvency of the bank, when the assets on which he has a lien are sufficient to pay the principal and interest but the total assets of the bank are not sufficient to pay in full ail creditors’ claims as of the date of insolvency. On March 28, 1931, respondent Lottie F. Sprague delivered $5,022.18 to the trust department of the Ticonic National Bank of Waterville, Maine, in trust, under an agreement which authoirized the trustée to invest in bonds or securities and to deposit at least $1,000 in its savings department at usual rates of interest; required specified monthly payments, subject to certain conditions, to Margaret Sprague, also a respondent here; and reserved to the grantor the right to revoke the trust and résumé possession of the trust funds. 408 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. The Ticonic Bank had been authorized by the Fédéral Reserve Board to act in a trust capacity, as provided in § 11 (k) of the Fédéral Reserve Act, as amended (12 U. S. C., § 248 (k) ). That Act provides that funds held in trust awaiting investment “shall not be used by the bank in the conduct of its business unless it shall first set aside in the trust department United States bonds or other securities” approved by the Board of Govemors of the Fédéral Reserve System, and further provides that “In the event of the failure of such bank the owners of the funds held in trust for investment shall hâve a lien on the bonds or other securities so set apart in addition to their claim against the estate of the bank.” Pending investment of funds under the Sprague trust, and pursuant to its resolution implementing the statutory provision just quoted, the Ticonic Bank placed the funds of this trust, along with other trust funds awaiting investment or distribution, as a deposit in its commercial checking department to the crédit of its trust department, and secured the total amount of such funds by setting aside in the trust department bonds, including $20,000 Kingdom of Denmark 6’s, 1942, at least equal in value to the total amount of such deposits. On July 29, 1935, respondents, the settlor and bene-ficiary, brought this suit in the District Court for Maine to hâve the bonds held as security with respect to the trust. It appears that on August 3, 1931, Ticonic Bank sold its assets (including the Denmark bonds) to the Peoples National Bank (later called Peoples-Ticonic National Bank) in considération of its agreement to “assume or pay ail the indebtedness of said Ticonic Bank to its depositors” ; that Ticonic Bank then went into vol-untary liquidation; that on March 4, 1933, the Peoples-Ticonic Bank was closed; that Arthur Picher was appointée! receiver for Peoples-Ticonic Bank on November 6, 1933, and subsequently, on June 28, 1934, for the Ti- TICONIC BANK v. SPRAGUE. 409 406 Opinion of the Court. conic Bank, which had been continuing its voluntary liquidation. The lower courts treated the suit, brought against both banks and against Picher as receiver, as one to assert and enforce the lien protecting the uninvested funds. They held that, in view of § 11 (k) of the Fédéral Reserve Act, as amended, respondents had acquired a lien upon the bonds set apart by the Ticonic Bank to secure the deposit of the trust department; and that this lien had never been discharged or divested and so extended to the proceeds of the Denmark bonds, which had been sold by the receiver for $20,722.66. We do not pause to state the conclusions of fact and of law by means of which the lower courts arrived at this resuit, for in the grant of the writ of certiorari this Court declined to review the ruling that a statutory lien for the protection of the own-ers of the funds held for investment extended to the proceeds of the Denmark bonds, the lower courts having predicated their decision in large part on the facts of this particular case. The decrees below did not end with the matters just stated. The District Court, finding that the proceeds of the bonds exceeded the trust funds on deposit,1 held the respondents entitled to payment in full of $3,649.65, the amount to which the Sprague trust account had been reduced, with interest from the date of the filing of the bill of complaint. At first the Circuit Court of Appeals reversed that part of the decree allowing interest, but on rehearing it affirmed the decree in toto, approving the allowance of interest out of the proceeds of the Denmark bonds, which it assumed were sufficient to meet with in 1 The total uninvested trust funds on deposit in the commercial department of the Ticonic Bank amounted to about $10,000 at the time of the sale of its assets, and to about $12,000 when the Peoples-Ticonic Bank was closed in 1933. 410 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. terest the amount of ail trust deposits. It ruled that although the requirement of ratable distribution precludes the recovery of interest against the general funds of an insolvent national bank, the general creditors hâve no rights in the trust funds here involved until after the se-cured daims are paid. The attention of this Court was called to the fact that the ruling conflicted with decisions in other circuits, where secured creditors were held not entitled to any interest after the suspension of the national bank,2 and for this reason certiorari was granted, limited to this question of interest. As an incident to the right to recover an unexpended balance in a deposit, a depositor is entitled to interest as damages for the failure to pay that balance upon de-mand.3 Compare Stewart v. Bar nés, 153 U. S. 456, 462; United States v. North Carolina, 136 U. S. 211, 216. The bank’s obligation to pay interest as damages for the détention of the debt is not eut off by suspension of its business and receivership. The principle has been es-tablished, and claimants held entitled to such interest, in cases where the principal amount of each of the daims was paid in full from the assets of the bank (National Bank v. Mechanics’ National Bank, 94 U. S. 437), in-cluding if necessary the double liability of the sharehold-ers (Richmond v. Irons, 121 U. S. 27, 64). 2 Richman v. First Methodist Episcopal Church, 76 F. (2d) 344, 346 (C. C. A. 3d), certiorari denied, Long v. First Methodist Episcopal Church, 296 U. S. 593; Douglass v. Thurston County, 86 F. (2d) 899, 909 (C. C. A. 9th); Fash v. First National Bank, 89 F. (2d) 110, 112 (C. C. A. lOth). 3We need not explore petitioner’s suggestion, that if interest is granted at ail it should be measured from an earlier date than that of the judicial demand contained in the bill of complaint, since respondent has filed no cross-petition for certiorari complaining of that restriction (Langnes v. Green, 282 U. S. 531, 536-538). 406 TICONIC BANK v. SPRAGUE. Opinion of the Court. 411 It is true that in the liquidation of national banks, dividends from the general funds on unsecured daims are made pro rata upon the amount of each claim as of the date of the insolvency, White v. Knox, 111 U. S. 784. This method of distribution gives a proportional part of the available funds to each créditer, in accordance with the statute requiring a “ratable dividend.” R. S. § 5236. Whether the reason for this method of deter-mining dividends is to avoid préjudice from the inévitable delay of court proceedings for liquidation (In re Humber Ironworks & Shipbuilding Co., IV Ch. App. Cas. 643, 646; American Iron & Steel Mfg. Co. v. Sea-board Air Line Ry., 233 U. S. 261, 266; cf. People v. American Loan Æ Trust Co., 172 N. Y. 371, 379; 65 N. E. 200) ; to facilitate administration (Sexton v. Dreyfus, 219 U. S. 339, 344; Chemical National Bank v. Armstrong, 59 Fed. 372, 378) ; or because on that date the creditors acquire a right in rem against the assets in the hands of the receiver (Chemical National Bank v. Armstrong, supra, 379; Merrill v. National Bank of Jacksonville, 173 U. S. 131, 140; Sexton v. Dreyfus, supra, 345) is imma-terial. Dividends are paid on that basis. It is in order to assure equality among creditors as of the date of insolvency that interest accruing thereafter is not consid-ered. But interest is proper where the idéal of equality is served, and so a creditor whose claim has been errone-ously disallowed is entitled on its allowance to interest on his dividends from the time a ratable amount was paid other creditors. Armstrong v. American Exchange National Bank, 133 U. S. 433, 470. The rule of White v. Knox, supra, does not require that interest be denied to the secured creditors unless the prin-ciple of equality of distribution is to be applied as between ail creditors. Secured creditors hâve two sources of pay-ment for their daims—the liability of the debtor and the 412 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. liability of the pledged or mortgaged assets. One is Personal, the other in rem. The liability in personam of the bank gives rise to a claim in rem against the free assets in the hands of the receiver ; the claim in rem against the security continues as a claim in rem against that same security. With respect to the former the secured creditors hâve merely the same rights as any general créditer, and in so far as dividends are paid to secured creditors from free assets, they share ratably with the unsecured creditors, and their claims bear interest to the same date, that of insolvency. Compare Merrill v. National Bank of Jack-sonville, 173 U. S. at 146; Aldrich v. Chemical National Bank, 176 U. S. 618, 638. But to the extent that one debt is secured and another is not there is manifestly an in-equality of rights between the secured and unsecured creditors, which cannot be affected by the principle of equality of distribution (American, Iron & Steel Mfg. Co. v. Seaboard, Air Line Ry., supra, at 266; Chemical National Bank v. Armstrong, supra, at 376-377), and interest accruing after insolvency may not be withheld on account of that principle. The rule as to the date to which interest is to be al-lowed on secured claims sharing pro rata with unsecured claims, cannot apply to the disposition of pledged or mortgaged assets subject to the lien of individual creditors, unless we are to disregard the rights in these assets prior to insolvency. But “liens, equities or rights arising . . . prior to insolvency and not in contemplation thereof, are not invalidated.” Scott v. Armstrong, 146 U. S. 499, 510; Merrill v. National Bank of Jacksonville, 173 U. S. 131, 145. By contract or, as in this case, by statute, the secured creditors gain or are given a lien on or right in property “in addition to their claim against the estate of the bank.” Section 11 (k) of the Fédéral Reserve Act as amended. The statutory lien prior to re-ceivership withdrew the pledged security from the assets 406 TICONIC BANK v. SPRAGUE. Opinion of the Court. 413 of the bank available to general creditors, in so far as might be necessary to satisfy the lien. Though title to the collateral was in the name of the bank, it was sub-ject to this lien, and to that extent the property pledged could not properly be said to belong to the bank for purposes of distribution to creditors. Scott v. Armstrong, supra at 510. As the obligation to pay interest is not destroyed by the insolvency and as the rights of the secured creditor in his collateral, contractual or statutory, are likewise un-affected, we are of the opinion that a secured creditor of a national bank in receivership may enforce his lien against his security, where it is sufficient to cover both principal and interest, until his claim for both is satis-fied. With respect to analogous liquidations the rule just announced has long been in force.4 This Court has al-ready held that a lienholder may look to his lien not only for the principal but also for interest accruing up to the date of payment, though his debtor has gone into bankruptcy (Coder n. Arts, 213 U. S. 223, 245, affirming, 152 Fed. 943, 950) or into equity receivership (American Iron & Steel Mjg. Co. v. Sedboard Air Line Ry., 233 U. S. 261), and though interest will be denied the un-secured creditors if the assets are insufficient to pay ail daims in full. Compare In re Humber Ironworks & Shipbuilding Co., IV Ch. App. Cas. 643, with In re Humber Ironworks & Shipbuilding Co., V Ch. App. Cas. 88. The same rule was applied to state banks in Washington-Alaska Bank v. Dexter Horton National Bank, 263 Fed. 304, 306. 4 Compare 7 Vin. Abr. 110: “A mortgagee shall hâve his interest run on upon a bankrupt’s estate, because he hath a right in rem, but as to other interest, it ceaseth on the bankruptcy. Per Ld. Chan. King, 18 July 1729.” 414 OCTOBER TERM, 1937. Counsel for Parties. 303 U. S. Petitioners suggest that the rule just laid down may hâve the effect of penalizing the unsecured creditors for the précaution of the receiver in litigating doubtful daims asserted against segregated assets. This could be true only where the interest accruing to the secured creditors during the pendency of the litigation exceeds the appréciation in value of, and the income from, the security. And since in many cases if the receiver is successful his conduct of the litigation will inure to the advantage of the general creditors, they may fairly be charged with the expenses of contesting the claim, including interest by way of damages. Cf. Chemical National Bank v. Armstrong, supra, 59 Fed. at 384. Affirmed. Mr. Justice Cardozo took no part in the considération or decision of this case. UNITED STATES v. WURTS. CERTIORARI TO THE CIRCUIT COURT OF APPEALS FOR THE THIRD CIRCUIT. No. 499. Argued February 28, 1938.—Decided March 14, 1938. Under § 610 of the Revenue Act of 1928, barring suits in the name of the United States to recover amounts erroneously refunded, unless brought within two years “after the making of such re-fund,” the period of limitation begins to run, not from the time of the allowance of the refund (the date when the Commissioner approves the schedule of overassessments), but from the time of its payment. P. 416. 91 F. 2d 547, reversed. Certiorari, 302 U. S. 678, to review the affirmance of a judgment for the taxpayer in a suit by the United States to recover an erroneous refund of taxes. Mr. Arnold Raum, with whom Solicitor General Reed, Assistant Solicitor General Bell, Assistant Attorney Gen- 414 UNITED STATES v. WURTS. Opinion of the Court. 415 eral Morris, and Messrs. Sewall Key and J. Louis Monarch were on the brief, for the United States. Mr. Claude C. Smith, with whom Messrs. Russell Duane and Sanford D. Beecher were on the brief, for respondent. Mr. Justice Black delivered the opinion of the Court. Under the Revenue Act of 1928,1 forbidding suit by the United States to recover an erroneous tax refund un-less brought “within two years after the making of such refund,” does the two year limitation begin when the refund is allowed or when it is paid? The Court of Appeals affirmed2 the District Court’s judgment holding the Government barred by this limitation because the présent suit was not brought within two years after the Commissioner allowed the refund by signing the schedule of over-assessments. The facts show that: March 15, 1932, the? Commissioner erroneously ap-proved a refund of taxes paid by respondent for the year 1929. April 30, 1932, a check was mailed to the taxpayer for this erroneous refund. April 26, 1934, more than two years after the allowance of the refund, but less than two years after actual payment, the Government brought this suit to recover the erroneous refund. The Government by appropriate action can recover funds which its agents hâve wrongfully, erroneously, or illegally paid.3 “No statute is necessary to authorize the United States to sue in such a case. The right to sue is independent of statute, . . .” United States v. Bank of the Metropolis, 15 Pet. 377, 401. Section 610 of the 1 Revenue Act of 1928, c. 852, 45 Stat. 791, § 610. 2 91 F. (2d) 547. 3 Wisconsin Central Railroad v. United States, 164 U. S. 190, 212; see United States v. Burchard, 125 U. S. 176, 180, 181. 416 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. 1928 Act, relied upon as barring recovery of this erron-eous and unwarranted tax refund, does not grant the Government a new right, but is a limitation of the Government’s long-established right to sue for money wrongfully or erroneously paid from the public treasury. Ordinarily, recovery of Government funds, paid by mis-take to one having no just right to keep the funds, is not barred by the passage of time.4 There is no contention here that respondent has any right to retain this refund erroneously paid by the Government. His defense is that the statutory bar prevents recovery. The Government’s right to recover funds, from a person who received them by mistake and without right, is not barred unless Congress has “clearly manifested its intention”6 to raise a statutory barrier. Section 610—urged by respondent as a statutory barrier—requires that the Government bring suit “before the expiration of two years after the making of such [erro-neous] refund. . . .” Respondent contends that the Revenue Act of 19326 indicated Congressional intent to designate the date of dllowance of a refund (the date the Commissioner signs the schedule of over-assessments) as the date of refund for computing the period of limitations under § 610. The 1932 Act provides: “Where the Commissioner has (before or after June 6, 1932) signed a schedule of overassessments in respect of any internai revenue tax imposed by [the Revenue Act of 1932] or any prior revenue Act, the date on which he first signs such schedule (if after May 28, 1928) shall be considered as the date of allowance of refund or crédit in respect of such tax.” This Act in no manner 4 Grand Trunk Western Ry. Co. v. United States, 252 U. S. 112, 121. 5 Compare, United States v. Nashville, C. & St. L. Ry. Co., 118 U. S. 120, 125. 6 Revenue Act of 1932, c. 209, 47 Stat. 169, § 1104. 414 UNITED STATES v. WURTS. Opinion of the Court. 417 relates to limitations on suits for erroneous refunds. It has no purpose in common with § 610 of the 1928 Act. The 1932 Act throws no light on the meaning of § 610. Section 610 is clear when its words are given their com-monly accepted import. “Congress may well be supposed to hâve used language in accordance with the common understanding.”7 Webster’s New International Diction-ary (2d ed., Unabridged) defines “refund” as “that which is refunded” and defines the transitive verb as: “to re-turn (money) in restitution, repayment . . ” Only by ignoring the common understanding of words could “mak-ing ... [a] refund” be considered synonymous with “allowing a refund.” That Congress had in mind the separate and distinct meanings of these two expressions is clearly demonstrated in House Report No. 2, 70th Congress, lst Session, p. 34, 35, containing the Committee Report on the Revenue Act of 1928: “The section (610) provides that any erroneous refund, . . . may be recovered by suit brought in the name of the United States if such suit is begun within two years after the making of the refund.” Immediately following, in referring to § 614, the Report stated : “The principal change made in existing law is that in the case of a refund the interest period now terminâtes with the allowance of the refund, a date which often précédés the actual making of the refund . . The Commissioner’s signature on a schedule of over-assessments does not finally establish a claimant’s right to a refund and does not preclude further investigation and considération of the claim. The Commissioner could later take his signature from the schedule and as pointed out by this Court might—even after a check was signed 7 Union Pacific R. Co. v. Hall, 91 U. S. 343, 347. 53383°—38----------27 418 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. and mailed—cancel the payment and revoke the authority of payment erroneously made.8 It would require language so clear as to leave room for no other reasonable construction in order to induce the belief that Congress intended a statute of limitations to begin to run before the right barred by it has accrued. Obviously, the Government had no right to sue this tax-payer to recover money before money had been paid to him. The construction urged by respondent would allow the statute of limitations to begin to run against recovery on an erroneous payment before any such payment is made. As said by a House Committee in reporting on a statute of limitations contained in a revenue act,9 “Logi-cally the period of limitation should run from the date of payment, since it is at that time that the right accrues.” We are of opinion that Congress did not intend the limitations of § 610 to run against the Government until the Government’s right “has accrued in a shape to be effectually enforced.”10 This statute does not begin to run against the Government when a claim is erroneously allowed. It begins to run from the date of payment. The judgment below is not in accord with this construction of the statute and is Reversed. Mr. Justice Cardozo and Mr. Justice Reed took no part in the considération or decision of this case. 8 Daube v. United States, 289 U. S. 367, 372. 9 House Report No. 179, 68th Congress, Ist Session, p. 27. 10 Cf., Borer v. Chapman, 119 U. S. 587, 602. ELECTRIC BOND CO. v. COMM’N. 419 • Syllabus. ELECTRIC BOND & SHARE CO. et al. v. SECURI-TIES AND EXCHANGE COMM’N et al. CERTIORARI TO THE CIRCUIT COURT OF APPEALS FOR THE SECOND CIRCUIT. No. 636. Argued February 7, 8, 9, 1938.—Decided March 28, 1938. 1. A System of holding companies controlled, through stock owner-ship, the operations of subsidiary companies which served gas and electricity to the public in many States, partly in interstate commerce. Some of the holding companies were themselves partly engaged in selling, purchasing or transmitting electricity across state lines. The System fumished expert service, and performed construction work, for the subsidiary utilities, and in so doing made continuous and extensive use of the mails and the instru-mentalities of interstate commerce. And such instrumentalities were from time to time used in other transactions, such as the distribution of securities. Held that the holding companies were engaged in activities within the reach of congressional régulation. P. 431. 2. Section 5 of Title I of the Public Utility Act of Aug. 26, 1935, requires holding companies, as defined, to register with the Securities and Exchange Commission and to file a registration state-ment giving information with respect to the organization, financial structure and nature of the business of the registrants together with varions details of operations. Section 4 (a) prohibits the use of the mails and the facilities of interstate commerce to those companies which fail to register. Section 32 provides that if any provision of the Title should be held invalid the others shall not be affected. Held: (1) The separability clause reverses the presumption of insepar-ability. P. 433. (2) Sections 4 (a) and 5 are not so woven into the Title that there is any inhérent or practical difficulty in enforcing them separately while reserving ail questions as to the validity of the other provisions of the Title. P. 434. (3) Although registration underlies and précédés the application of the other regulatory provisions, §§ 4 (a) and 5 were intended to be independently operative and enforceable as régulations requiring holding companies to furnish the information called for by § 5 (b) in registration statements. P. 435. 420 OCTOBER TERM, 1937. Statement of the Case. 303 U. S. (4) The legislative history of the Act is consistent with this view. P. 438. 3. Corporations engaged in interstate commerce can not escape régulation by acting through subsidiaries. P. 440. 4. In view of the relation of the holding companies in this case to interstate commerce, and to the national economy, Congress had power to exact of them the information required by § 5 of Title I of the Public Utility Act, and to visit their failure with the penalties prescribed by § 4 (a), restraining their use of interstate commerce and postal facilities while they remain holding companies and refuse to register. P. 439. 5. In a suit by the Securities and Exchange Commission under § 18 (f), Title I, Public Utility Act, brought to enforce only compliance with §§ 4 (a) and 5, the requirements and validity of the other provisions of the Title not being involved in the actual contro-versy,—held that a counterclaim and cross-bill by which the de-fendants invoked the Fédéral Declaratory Judgment Act, and sought to hâve the other provisions declared unconstitutional, was properly dismissed. P. 443. 92 F. 2d 580, affirmed. Certiorari, 302 U. S. 681, to review the affirmance of a decree of the District Court which granted an injunction and dismissed a counterclaim and cross-bill in a suit against numerous corporations, brought by the Securities and Exchange Commission under § 18 (f) of Title I of the Public Utility Act of 1935. Other corporations had intervened in the District Court as défendants. The injunction forbade the holding-company défendants, as long as they continued to be holding companies and failed to register, from using the mails or the facilities of interstate commerce as banned by § 4 (a) of the Act. The counterclaim and cross-bill prayed for a declaratory judgment declaring the whole Title void, and that the Commission and its members, the Attorney General and the Postmaster General be enjoined from enforcing any of its provisions. See the opinion of Mack, Circuit Judge, in 18 F. Supp. 131. 419 ELECTRIC BOND CO. v. COMM’N. Argument for Petitioners. 421 Messrs. Thomas D. Thacher and John F. MacLane, with whom Messrs. Frank A. Reid and A. J. G. Priest were on the brief, for petitioners. The Act is wholly invalid because of its scope and ail-inclusive provisions. It inseparably commingles intrastate and Interstate companies and activities by common définitions and provisions and cannot be confined by judicial limitation to companies or activities within the power of Congress. It must be regarded as a whole and read in its entirety to détermine the separability of any section or sections. Particular sections cannot be isolated and considered in a vacuum without regard to their setting and context and their functional relationship to the Act as a whole. Thus reading §§ 4 (a) and 5 (separated by the decision of the courts below from the regulatory or control provisions of the Act) it is clear that they are not a sub-stantive régulation by themselves but are purely auxiliary to such regulatory or control provisions, specifically §§ 6 to 13. Their inseparability is demonstrated by the declared scope and purpose of the Act (§ 1) which'makes mani-fest that it was the intention of Congress by its enactment to control public utility holding companies, even to the point of their destruction. In this light, §§ 6 to 13 (the control sections) are the bone and sinew of the Act. They are the sections which Congress relied upon to accomplish its declared purpose of “eliminating” the evils in public utility holding company Systems. Sections 4 (a) and 5, reinforced by the heavy penalties of 29, merely implement this System of Controls. 4 (a) coerces holding companies to register and thereby to submit to such Controls. 5 (a) provides the mechanics for registration, and 5 (b) provides for furnishing the basic 422 OCTOBER TERM, 1937. Argument for Petitioners. 303 U. S. information concerning the companies upon which the Controls specified by 6 to 13 are to operate. Sections 4 (a) and 5 do not constitute a separable System of régulation by publicity. Not only was no such independent function intended, but, as demonstrated by their relationship to the Act, they cannot perform any such function. The contents of the registration statement prescribed by § 5 (b) do not relate to, and thus cannot regulate, the activities described by 4 (a), but do relate to, and furnish the basic information for, the application of the control System. The contents of the registration statement may not be disclosed except in the discrétion of the Commission (22). Consequently, régulation by publicity is not its function. If §§ 4 (a) and 5 be regarded as a separable statutory enactment, they are not a constitutional, valid and rea-sonable régulation of interstate commerce and the mails. Section 5 (a) is not a régulation of commerce or the mails, nor is it claimed to be. As previously shown, 5 (b) relied upon alone to support the penalties of 4 (a) is not regulatory of the transactions thereby prohibited nor of any business in interstate commerce. Considered alone, § 5 (b) is a naked grant of inquisitorial or visitatorial power and is invalid because not an exercise of any constitutional power. Unless the Commission has some function to perform with respect to the information furnished, it becomes an unlawful délégation of legislative power to the Commission, since the form and content are to be prescribed entirely by rules and régulations of the Commission in its concept of the public interest and the interest of investors and consumers. Section 5 (b) cannot be supported by 4 (a), which, being merely a penalty, cannot validate régulations with which it coerces compliance. Assuming power to exclude holding companies from interstate business and normal use of the mails and in- 419 ELECTRIC BOND CO. v. COMM’N. 423 Argument for Petitioners. strumentalities of interstate commerce, such power can-not be used to coerce compliance with unconstitutional régulation. Standing by itself as a naked penalty, § 4 (a) contravenes the Fifth, Sixth and Eighth Amendments to the Constitution. If, therefore, the decree cannot be supported on the foundation of §§ 4 (a) and 5 standing alone, it is neces-sary to find such support in the substantive regulatory System of the Act, i. e., the Controls of §§ 6 to 13. These sections do not regulate interstate commerce or the use of the mails. The companies which comprise the electric and gas utility industry are not, as such, in-strumentalities or agents of interstate commerce, rior is their business, as such, interstate commerce. Some of the companies do engage in particular business or transactions which constitute interstate commerce and which may be regulated, but other companies do no such business. This Act predicates the régulation of ail alike merely on the holding company relationship and not upon engagement in any business or activities which constitute or affect interstate commerce. Nor are the control sections predicated upon or con-fined to the régulation of activities constituting or di-rectly affecting interstate commerce or the use of the mails. They relate to the issue and sale of securities (§§ 6-7); to the acquisition of assets or securities ('§§ 8-10); to sundry corporate and financial transactions (§ 12); to the reorganization or dissolution of holding company Systems (§ 11) ; and to the performance of service, sales and construction contracts (§13). In none of these sections is interstate commerce or the use of the mails a condition of the régulation of a particular transaction, nor need the company whose transactions are so regulated be engaged in interstate commerce or activities directly affecting such commerce. 424 OCTOBER TERM, 1937. Argument for Petitioners. 303 U. S. Conversely, the Act invades the reserved powers of the States, in violation of the Tenth Amendment, in its interférence with purely intrastate transactions, and in its control of purely intrastate corporations in the exercise of charter powers given them by the States of their incorporation. The absence of any standard for the Commission’s action in the varions matters entrusted to its control, except its untrammelled conception of the public interest and the interest of investors and consumers, makes the Act an unconstitutional délégation of legislative powers to the Commission, in violation of Article I, § 1 of the Constitution. The Act is lacking in due process and offends against the Fifth Amendment. Fundamentally, its essential concept is not régulation by prescribed standards of law, but the transfer of control of corporations from their direc-tors and stockholders to the Commission, in terms so broad that management is transferred from the owners of the property to the public. This power extends to the control of their essential activities, and even to the disposai of their property and assets, and the reorganization of the companies themselves. If the decree of the court below is correct in requiring défendants to register, on the theory of the separability of §§ 4 (a) and 5 unsupported by the control provisions, the défendants, being under a duty to register, and being threatened with irréparable in jury by the Controls of the Act, hâve a right to relief under their cross-bill either by way of injunction or declaratory judgment, against those control sections which become applicable to them immediately upon registration. If the holding companies themselves hâve not the right to question these Controls by their cross-bill, the inter-vening subsidiary défendants, immediately affected in ail ELECTRIC BOND CO. v. COMM’N. 425 419 Argument for Respondents. respects equally with their parent holding companies by the registration of the latter, hâve the right by their intervention and cross-bills to obtain an adjudication as to whether or not the Controls of the Act to which they are thereby subjected are constitutional as to them. Assistant Attorney General Jackson and Mr. Benjamin V. Cohen, with whom Attorney General Cummings, Solicitor General Reed, Assistant Solicitor General Bell, and Messrs. Allen E. Throop, Thomas G. Corcoran, Paul A. Freund, John J. Abt, and Frederick B. Wiener were on the brief, for respondents. The bill and answer involve solely the validity of the registration provisions. The registration provisions are not inherently inséparable from the other provisions of the Act. Compliance with them does not préjudice the right of a registrant to contest other provisions. They are capable of separate operation and enforcement. The legislative history of the Act corroborâtes the presumption of separability. The registration provisions are a substantial regula-tory measure in themselves and would not be too frag-mentary to stand alone. Défendants can not attack provisions of the Act not otherwise in controversy merely to show that the registration provisions would be too fragmentary to stand if such other provisions were invalid. The registration provisions are a valid exercise of the fédéral power over interstate commerce and the mails. The activities enumerated in § 4 (a) are subject to fédéral.régulation by the informatory process. Congress has the power to prevent the use of the channels of interstate commerce and the postal facilities for a purpose or in a manner deemed contrary to Sound public policy. 426 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. The power of Congress under the commerce clause is not limited to forbidding the transportation of articles intrinsically harmful. The question of the power of Congress to meet evils which are uot spread or perpetuated by the use of the channels of Interstate commerce is not here involved. The power of Congress to regulate the use of the chan-nels of Interstate commerce or the mails is not abridged by the fact that the use of such channels of intercourse is incideütal or sporadic or is not the major activity of the user. The registration provisions do not violate any rights guaranteed to the défendants under the Fifth Amendment. They involve no unconstitutional délégation of power. The cross-bill presented no casé or controversy but sought only an advisory opinion on hypothetical facts. As a suit for an injunction, the cross-bill, in the absence of threats of enforcement by the cross-defendants, présents no controversy with them. As a suit for a declaratory judgment, the cross-bill, in the absence of threats of enforcement by the cross-defendants, présents no “actual controversy” with them. Even if the cross-bill had presented a controversy with the cross-defendants, the District Court could not properly hâve granted défendants an injunction or declaratory judgment because they hâve proved no damage, irréparable or otherwise. Défendants do not seek equity with clean hands in bringing, before they hâve registered, a cross-bill which présupposés that their failure to register is unlawful. Mr. Chief Justice Hughes delivered the opinion of the Court. The Securities and Exchange Commission brought this suit to enforce the provisions of §§ 4 (a) and 5 of the 419 ELECTRIC BOND CO. v. COMM’N. 427 Opinion of the Court. Public Utility Holding Company Act of 1935. 49 Stat. 803, 812, 813. These sections provide for registration with the Commission of holding companies, as defined, § 5 (a), and prohibit the use of the mails and the in-strumentalities of interstate commerce to those companies which fail to register. § 4 (a). Section 5 (b) provides for the filing of a registration statement giving information with respect to the organization, financial structure and nature of the business of the registrant, together with varions details of operations. Défendants, including intervenors, contested.the validity of these provisions and sought by cross bill a declara-tory judgment that the Act was invalid in its entirety, as being in excess of the powers granted to Congress by § 8 of Article I, and in violation of § 1 of Article I and of the Fifth and Tenth Amendments, of the Constitution of the United States. The District Court sustained the validity of §§ 4 (a) and 5, and granted an injunction accordingly. The cross bill was dismissed for want of equity and for lack of any actual controversy within the meaning of the Fédéral Declaratory Judgment Act of 1934. 18 F. Supp. 131. The Circuit Court of Appeals affirmed the decree. 92 F. (2d) 580. Certiorari was granted. The suit was brought against the Electric Bond and Share Company and fourteen associated public utility companies. Of these, it appears that seven hâve ceased to be holding companies within the meaning of the Act, two1 before the cause was heard by the District Court and five2 since the decree. The remaining companies against whom the decree of injunction runs are Electric Bond and Share Company, American Gas and Electric 1 Idaho Power Company and The Montana Power Company. 2 United Gas Corporation, United Gas Public Service Company, Houston Gulf Gas Company, Nebraska Power Company, and Power Securities Company. 428 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. Company, American Power & Light Company, National Power & Light Company, Electric Power & Light Corporation, Lehigh Power Securities Corporation, Utah Power & Light Company, and Pacific Power & Light Company. The decree provides in substance, as to each of these défendants, that after a day specified and until such de-fendant shall cease to be a holding company as defined in the Act, or shall register with the Securities and Exchange Commission as provided in § 5 (a), it shall not carry on any of the activities in Interstate commerce or through the mails which are forbidden to non-registered holding companies by Paragraphs (1), (2), (3), (4) and (6) of § 4 (a). The provisions of §§ 4 (a) and 5 are set forth in the margin.3 3“Sec. 4. (a). After December 1, 1935, unless a holding company is registered under section 5, it shall be unlawful for such holding company, directly or indirectly— “(1) to sell, transport, transmit, or distribute, or own or operate any utility assets for the transportation, transmission, or distribution of, natural or manufactured gas or electric energy in Interstate commerce; “(2) by use of the mails or any means or instrumentality of inter-state commerce, to negotiate, enter into, or take any step in the performance of, any service, sales, or construction contract undertak-ing to perform services or construction work for, or sell goods to, any public-utility company or holding company; “(3) to distribute or make any public offering for sale or exchange of any security of such holding company, any subsidiary company or affiliate of such holding company, any public-utility company, or any holding company, by use of the mails or any means or instrumentality of interstate commerce, or to sell any such security having reason to believe that such security, by use of the mails or any means or instrumentality of interstate commerce, will be distributed or made the subject of a public offering; “(4) by use of the mails or any means or instrumentality of interstate commerce, to acquire or negotiate for the acquisition of any security or utility assets of any subsidiary company or affiliate of ELECTRIC BOND CO. v. COMM’N. 429 419 Opinion of the'Court. The decree further provides that the injunction and the dismissal of the cross bill shall be without préjudice “to any rights or remedies in law or in equity” which défendants may hâve after registration, and leaves défendants free to challenge the validity of any of the provisions of the Act other than §§ 4 (a) and 5. The dismissal of the such holding company, any public-utility company, or any holding company; “(5) to engage in any business in interstate commerce; or “(6) to own, control, or hold with power to vote, any security of any subsidiary company thereof that does any of the acts enumer-ated in paragraphs (1) to (5), inclusive, of this subsection. “Sec. 5. (a) On or at any time after October 1, 1935, any holding company or any person [sic] purposing to become a holding company may register by filing with the Commission a notification of registration, in such form as the Commission may by rules and régulations prescribe as necessary or appropriate in the public interest or for the protection of investors or consumers. A person shall be deemed to be registered upon receipt by the Commission of such notification of registration. “(b) It shall be the duty of every registered holding company to file with the Commission, within such reasonable time after registration as the Commission shall fix by rules and régulations or order, a registration statement in such form as the Commission shall by rules and régulations or order prescribe as necessary or appropriate in the public interest or for the protection of investors or consumers. Such registration statement shall include— “(1) such copies of the charter or articles of incorporation, part-nership, or agreement, with ail amendments thereto, and the bylaws, trust indentures, mortgages, underwriting arrangements, voting-trust agreements, and similar documents, by whatever name known, of or relating to the registrant or any of its associate companies as the Commission may by rules and régulations or order prescribe as necessary or appropriate in the public interest or for the protection of investors or consumers; “(2) such information in such form and in such detail relating to, and copies of such documents of or relating to, the registrant and its associate companies as the Commission may by rules and régulations 430 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. cross bill is also declared to be without préjudice “to any rights or remedies in law or in equity” which the interven-ing défendants “may hâve or be entitled to upon the Act or order prescribe as necessary or appropriate in the public interest or for the protection of investors or consumers in respect of— “(A) the organization and financial structure of such companies and the nature of their business; “(B) the terms, position, rights, and privilèges of the different classes of their securities outstanding; “(G) the terms and underwriting arrangements under which their securities, during not more than the five preceding years, hâve been offered to the public or otherwise disposed of and the relations of underwriters to, and their interest in, such companies; “(D) the directors and officers of such companies, their rémunération, their interest in the securities of, their material contracts with, and their borrowings from, any of such companies; “(E) bonus and profit-sharing arrangements; “(F) material contracts, not made in the ordinary course of business, and service, sales, and construction contracts; “(G) options in respect of securities; “(H) balance sheets for not more than the five preceding fiscal years, certified, if required by the rules and régulations of the Commission, by an independent public accountant; “(I) profit and loss statements for not more than the five preceding fiscal years, certified, if required by the rules and régulations of the Commission, by an independent public accountant; "(3) such further information or documents regarding the regis-trant or its associate companies or the relations between them as the Commission may by rules and régulations or order prescribe as necessary or appropriate in the public interest or for the protection of investors or consumers. “(c) The Commission by such rules and régulations or order as it deems necessary or appropriate in the public interest or for the protection of investors or consumers, may permit a registrant to file a preliminary registration statement without complying with the provisions of subsection (b); but every registrant shall file a complété registration statement with the Commission within such reasonable period of time as the Commission shall fix by rules and régulations or order, but not later than one year after the date of registration. “(d) Whenever the Commission, upon application, finds that a registered holding company has ceased to be a holding company, it 419 ELECTRIC BOND CO. v. COMM’N. Opinion of the Court. 431 being made applicable to them by the registration of any holding company of which they are subsidiary companies.” Ail rights of défendants, including intervenors, are thus fully reserved with respect to the application to them of any provision of the Act outside of those contained in the particular sections which are enforced by the decree. Petitioners insist that the Act is invalid as a whole ; that the provisions of §§ 4 (a) and 5 are not separable from the remainder; that these provisions, if separately considered, do not constitute a valid régulation of interstate commerce and the mails; and that the cross bill pre-sented a controversy upon the merits of which the défendants, including intervenors, were entitled to the judgment of the court. First. The initial question is whether the défendant companies, against which the decree for injunction runs, are engaged in activities which bring them within the ambit of congressional authority. Upon this point there seems to be no serious controversy, and for the purpose of the présent decision we do not find it necessary to make a comprehensive statement of the corporate setup and operations of the respective défendants. The facts were fully set forth in an elaborate stipulation which underlay the findings of fact of the trial court. A brief statement addressed to the point now under considération will suffice. Electric Bond and Share Company is styled in the findings as “the top holding company” in “a holding-company System” in which ail the other défendants and in-tervening défendants together with numerous other companies are subsidiaries. Electric Bond and Share Company owns substantial minorities of the voting stocks shall so déclaré by order and upon the taking effect of such order the registration of such company shall, upon such tenns and conditions as the Commission finds and in such order prescribes as necessary for the protection of investors, cease to be in effect. The déniai of any such application by the Commission shall be by order.” 432 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. of the défendants American Gas and Electric Company1, American Power & Light Company, National Power & Light Company, and Electric Power & Light Corporation. These companies in tum own directly or through subholding companies substantial majorities, in some cases approximating complété ownership and in ail cases sufîicient to insure voting control, of the com-mon stocks of operating gas and electric utilities. The “electric operations” of subsidiaries in the Bond and Share System are conducted in thirty-two States. Some operate only within a single State, some in two or more States, transmitting energy across state lines for their own ac-count, and some sell energy at Wholesale in interstate commerce. Until shortly prior to the institution of this suit Electric Bond and Share Company rendered services to both holding and operating companies under service con-tracts. After the approval of the Act, it formed a wholly-owned subsidiary, Ebasco Services Incorporated, to take over the servicing of the operating companies, and the servicing of the holding companies was discontinued. The performance of service contracts by Ebasco, operating as a subsidiary and on behalf of Electric Bond and Share Company, constitutes an extensive business in ren-dering continuons expert, specialized, and technical service, advice, and assistance to the serviced companies upon every phase of the utility enterprise. Phoenix Engineering Corporation, a wholly-owned subsidiary of Ebasco, performs construction work for subsidiary public-utility companies in the Bond and Share System. The American Gas and Electric Company also performs services for subsidiary operating companies. We need not go further in the description of the operations of these Companies, as petitioners concédé that the carrying out of these service contracts, as found by the trial court, involves continuous and extensive use of the 419 ELECTRIC BOND CO. v. COMM’N. Opinion of the Court. 433 mails and instrumentalities of interstate commerce, al-though petitioners are careful to qualify the concession by saying that they agréé with the trial court that “this is not to say that the entire business of Ebasco or American Gas constitutes interstate commerce and is there-fore subject to unlimited fédéral régulation.” Petitioners also state with respect to American Power & Light Company, National Power & Light Company, and Electric Power & Light Corporation, that while it is in-sisted that these are simply investment holding com-panies and that their business as such is not interstate commerce, they may “from time to time engage in transactions in interstate commerce or may use the instrumentalities of interstate commerce in particular transactions, such as the distribution of securities, in such man-ner that those particular activities become the subject of fédéral régulation.” The trial court found that one or more subsidiary elec-tric-utility companies of Lehigh Power Securities Corporation “are regularly engaged in selling, purchasing, or transmitting some electric energy across state lines”; and that Utah Power & Light Company and Pacific Power & Light Company are both holding companies and electric-utility companies and that the transmission of electric energy across state lines is part of the enterprise of each. In the light of the findings supported by the stipulation, we perceive no ground for a conclusion that the de-fendant companies which are enjoined are not engaged in activities within the reach of the congressional power. Second. Challenging the validity of the Act in its en-tirety, petitioners contend that §§ 4 (a) and 5 cannot be separated from the other provisions of the Act and thus be separately sustained and enforced. They urge that these sections are purely auxiliary to the subséquent or “control provisions” of the Act ( § § 6 to 13) ; that the 53383°—38--------28 434 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. object of this suit is to compel submission to an inte-grated System of con'trol and that the sole question is whether the Act as a whole, “or enough to accomplish its general plan,” is constitutional. They insist that this question must be determined before they may be com-pelled to register. (1) In this branch of the case, petitioners address their argument to the intent of Congress, rather than to its power. But Congress has defined its intent as to separa-bility. Section 32 of the Act provides: “If any provision of this title4 or the application of such provision to any person or circumstances shall be held invalid, the remainder of the title and the application of such provision to persons or circumstances other than those as to which it is held invalid shall not be affected thereby.” This provision reverses the presumption of insepara-bility—that the législature intended the Act to be effective as an entirety or not at ail. Congress has established the opposite presumption of divisibility. Williams v. Standard Oil Co., 278 U. S. 235, 242; Utah Power & Light Co. v. Pjost, 286 U. S. 165, 184; Champlin Re-fining Co. v. Corporation Commission, 286 U. S. 210, 235. Congress has thus said that the statute is not an inte-grated whole, which as such must be sustained or held invalid. On the contrary, when validity is in question, divisibility and not intégration is the guiding principle. Invalid parts are to be excised and the remainder en-forced. When we are seeking to ascertain the congres-sional purpose, we must give heed to this explicit déclaration. (2) It is évident that the provisions of §§ 4 (a) and 5 are not so interwoven with the other provisions of the 4 The “title” is “Title I—Control of Public-Utility Holding Companies.” ELECTRIC BOND CO. v. COMM’N. 435 419 Opinion of the Court. Act that there is any inhérent or practical difficulty in the séparation and independent enforcement of the former while reserving ail questions as to the validity of the latter. The administrative construction of the statute was formulated in that view. Rule 4 of the Commission provided that any person, in filing any statement under the Act, might include an express réservation of constitutional and legal rights. It was on the basis of that construction that this suit was prosecuted and was limited to the enforcement of §§ 4 (a) and 5. Ail rights and remedies as to ail other provisions of the Act are, as we hâve seen, expressly reserved to the défendants by the decree. Nor can it be said that this réservation is illusory. If this decree is affirmed, it will constitute a spécifie adjudication that registration will be without préjudice to future challenge of the validity of any provision of the Act, or requirement of the Commission, outside of §§ 4 (a) and 5. It is idle to contend that registration pursu-ant to the decree will subject the défendants to the Act as an integrated whole or bring into operation against them what the decree expressly excludes. (3) Although there is no practical obstacle to the sepa-rate enforcement of the provisions of §§ 4 (a) and 5, the argument is pressed that in reason and design there is an essential unity of these provisions and the so-called “control provisions” which forbids such enforcement. Peti-tioïiers urge that §§ 4 (a) and 5 “merely implement the System of Controls” ; that the policy of the Act as declared in § 1 (c) is to compel “the simplification and the elimini-nation of holding company Systems”; and that the objective cannot be attained by informatory processes but only by such régulation or control as will “eliminate” the evils. The Government replies that while the other provisions are applicable only to registered companies and their subsidiaries, §§ 4 (a) and 5 are drafted so as to be opéra- 436 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. tive independently and that the registration provisions themselves constitute “an effective instrument of informa-tory régulation.” “If, for example,” argues the Government, “section 11 dealing with corporate reorganizations were adjudged invalid, there is no inhérent reason why the other regulatory provisions could not be enforced as the Congress provided. And if section 13 dealing with service contracts were adjudged invalid, there is no inhérent reason why the registration provisions, or sections 6 and 7 regulating security issues, or sections 8, 9 and 10 dealing with utility acquisitions, could not be adminis-tered in accordance with their terms.” “Likewise,” it is said, “the purpose and effect of the registration provision—régulation by the informatory process—are the same whether registration is considered as a separate statute regulating utility holding companies, or as but one part of a comprehensive statute containing many different régulations of utility holding companies.” More-over, as observed by the District Court, § 1 (c) in its entirety négatives any conclusion that the simplification and élimination of holding companies “is the sole policy or the whole end and object of the Act, which, as stated, is To meet the problems and eliminate the evils, as enu-merated in this section, connected with public utility holding companies,’ ” and thus “simplification and élimination” are but a means and not “the exclusive means” deemed to be essential for the purpose of effectuating such policy “in whole or insofar as may be constitutionally possible.” We think that the manner in which the Act is framed and the variety of provisions it contains, when viewed in the light of the presumption of divisibility, justify that cohclusion. The fact that registration underlies the application of subséquent requirements of the statute does not prevent the provisions of §§ 4 (a) and 5 from having a purpose and a value of their own. Section 5 not only 419 ELECTRIC BOND CO. v. COMM’N. 437 Opinion of the Court. provides in paragraph (a) for the filing of a “notification of registration” but also requires by paragraph (b) every registered holding company to submit, within a reason-able time after registration, a “registration statement” containing a variety of detailed information as to corporate structure and activities. Thus § 5 (b) is itself a “control” provision, which is immediately operative. The duty to supply the described information is separately and definitely prescribed. It cannot be denied that a requirement of this sort is a régulation which Congress could hâve regarded as important in itself and could hâve made the subject of a sepa-rate statute. The fact that it is found in a statute imposing other régulations, or that it précédés the application of the others, does not deprive it of its essential character and its capacity to stand alone. Régulation re-quiring the submission of information is a familiar cate-gory. Information bearing upon activities which are within the range of congressional power may be sought not only by congressional investigation as an aid to appropriate législation, but through the continuous supervision of an administrative body. See Interstate Commerce Commission v. Brimson, 154 U. S. 447, 474; Interstate Commerce Commission v. Goodrich Transit Co., 224 U. S. 194, 211; American Téléphoné & Telegraph Co. v. United States, 299 U. S. 232, 235, 237. Congress may use this method in connection with a comprehensive scheme of régulation, as, for example, in the case of the Interstate Commerce Commission and the Fédéral Communications Commission; or Congress may employ this informatory process independently. An illustration of the latter is found in the statute relating to newspapers and periodicals, enjoying the privilèges accorded to second class. mail, which requires an annual statement setting forth the names and addresses of the editor, publisher, business manager, owner, and, in case of ownership by a 438 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. corporation, the stockholders, and also the names of known bondholders or other security holders, together with a statement as to circulation. 39 U. S. C. 233. See Lewis Publishing Co. v. Morgan, 229 U. S. 288. Petitioners refer to the limitations upon publicity con-tained in § 22 and contrast this provision with that of the Securities Act of 1933, § 6 (d), 48 Stat. 74, 78. But § 22 provides that the information shall be available to the public when in the judgment of the Commission its disclosure would be in the public interest or the interest of investors or consumers. The limitations are plainly in-tended to safeguard particular information which may be regarded as of a private or confidential character and as not directly concerning the public interest. They do not detract from the value which may be deemed to attach to the requirement that the described information should be furnished, whether as an aid to législation or as facili-tating administrative supervision or as securing a désirable publicity. Both parties invoke the legislative history of the Act. Petitioners contend that this shows that control, not publicity, was intended. The Government insists that the legislative history supports the presumption of separabil-ity. It is unnecessary to review the details of the arguments or the cited statements from the legislative halls. The Act speaks for itself with sufficient clarity. The Government points to six groups of regulatory provisions contained in the Act, viz., registration (§§ 4 and 5); is-suance of securities ( § § 6 and 7) ; acquisition of securities and utility assets ( § § 8,9 and 10) ; corporate simplification and reorganization (§ 11); service contracts and other inter-company transactions (§§ 12 and 13); and reports and accounts ( § § 14 and 15). We see nothing in the legislative history of the Act which requires the conclusion that ail these groups were intended to constitute a unitary System, no part of which can fail without destroying the 419 ELECTRIC BOND CO. v. COMM’N. Opinion of the Court. 439 rest. On the contrary, we think that the intent of Congress is that these varions groups of régulations, as well as particular provisions of each group, should be regarded as separable so that, if any such group or provision should be found to be invalid, that invalidity should not extend to the remaining parts if by reason of their nature and as a practical matter they could be separately sustained and enforced. Congress provided in § 18 (f) that the Commission might bring an action to enforce compliance with the Act or any rule, régulation or order thereunder, and that upon a proper showing a permanent or temporary injunc-tion or decree should be granted. In pursuance of that authority, the présent action was brought solely to enforce the provisions of §§ 4 (a) and 5. We find no basis for holding that these provisions cannot be separately enforced if they are valid and we turn to that question. In view of this conclusion as to separability, it is unneces-sary to go through the statute in order to détermine whether other provisions are valid or invalid, and we do not intimate that there would not be found in any event a workable System in addition to the registration sections. Third. Petitioners contend that, standing by themselves, §§ 4 (a) and 5 transgress constitutional restrictions. These sections hâve three parts. Section 5 (a) provides for the filing of a notification of registration. Section 5 (b) makes it the duty of every registered holding company to file a registration statement, with documents and certain detailed information, within a reasonable time after registration. Section 4 (a) prescribes the penalty for failure to register under § 5. As the requirement of information is in itself a permissible and useful type of régulation {Interstate Commerce Commission v. Brim^-son, supra; Interstate Commerce Commission v. Goodrich, Transit Co., supra; American Téléphoné Æ Telegraph Co. v. United States, supra), the question is whether the par- 440 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. ticular demand, here assailed, can be validly addressed to the défendants enjoined by the decree, and, if so, whether it exceeds constitutional limits because of the character and extent of the information sought. The findings of the District Court based upon the stipulation of facts leave no room for doubt that these de-fendants are engaged in transactions in interstate commerce. That they conduct such transactions through the instrumentality of subsidiaries cannot avail to remove them from the reach of the fédéral power. It is the substance of what they do, and not the form in which they clothe their transactions, which must afford the test. The constitutional authority confided to Congress could not be maintained if it were deemed to dépend upon the mere modal arrangements of those seeking to escape its exercise. Compare Northern Securities Co. v. United States, 193 U. S. 197. We need not now détermine to what précisé extent these défendants are actually engaged in interstate commerce. It is enough that they do hâve continuous and extensive operations in that commerce, and Congress cannot be denied the power to demand the information which would furnish a guide to the régulation necessary or appropriate in the national interest. Régulation is addressed to practices which appear to need supervision, correction or control. And to détermine what régulation is essential or suitable, Congress is entitled to consider and to estimate whatever evils exist. Congress has set forth in the Act what it considers to be the factual situation and the need of fédéral supervision. The following statement is found in paragraph (a) of §1: “Public-utility holding companies and their subsidiary companies are affected with a national public interest in that, among other things, (1) their securities are widely marketed and distributed by means of the mails and in-strumentalities of interstate commerce and are sold to a ELECTRIC BOND CO. v. COMM’N. 441 419 Opinion of the Court. large number of investors in different States; (2) their service, sales, construction, and other contracts and arrangements are often made and performed by means of the mails and instrumentalities of interstate commerce; (3) their subsidiary public-utility companies often sell and transport gas and electric energy by the use of means and instrumentalities of interstate commerce; (4) their practices in respect of and control over subsidiary companies often materially affect the interstate commerce in which those companies engage; (5) their activities ex-tending over many States are not susceptible of effective control by any State and make difficult, if not impossible, effective State régulation of public-utility companies.” Congress has further declared in paragraph (b) of that section, upon the basis of facts disclosed by the reports of the Fédéral Trade Commission and of the Committee on Interstate and Foreign Commerce of the House of Représentatives, and otherwise ascertained, the circumstances in which the national interest and the interest of investors and consumers may be adversely affected by the operation of public utility holding companies. And after this catalogue of the abuses which may exist in the circumstances described, Congress déclarés it to be its policy “to meet the problems and eliminate the evils as enu-merated in this section, connected with public-utility holding companies which are engaged in interstate commerce or in activities which directly affect or burden interstate commerce.” Without attempting to state the limits of permissible régulation in the execution of this declared policy, we hâve no reason to doubt that from these défendants, with their highly important relation to interstate commerce and the national economy, Congress was entitled to demand the fullest information as to organization, financial structure and ail the activities which could hâve any bearing upon the exercise of con-gressional authority. The régulation found in § 5 (b) 442 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. goes no further than to require this information and we are of the opinion that its validity must be sustained. Section 4 (a) prescribes the penalty for failure to reg-ister under § 5, and that section as an incident to registration imposes the duty to file the described registration statement. Treating the requirements of §§ 4 (a) and 5 as a separable part of the Act, the question is whether that penalty may be validly imposed. In the imposition of penalties for the violation of its rules, Congress has a wide discrétion. Sanctions may be of various types. See Helvering v. Mitchell, ante, p. 391. They may involve the loss of a privilège which would otherwise be enjoyed. Id. Note 2. When Congress lays down a valid rule to govern those engaged in transactions in interstate commerce, Congress may deny to those who violate the rule the right to engage in such transactions. Champion v. Ames, 188 U. S. 321; United States v. Dela-ware & Hudson Co., 213 U. S. 366, 415; Brooks n. United States, 267 U. S. 432, 436, 437; Gooch v. United States, 297 U. S. 124; Kentucky Whip & Collar Co. v. Illinois Central R. Co., 299 U. S. 334, 346, 347. And while Congress may not exercise its control over the mails to enforce a requirement which lies outside its constitutional province, when Congress lays down a valid régulation pertinent to the use of the mails, it may withdraw the privilège of that use from those who disobey. Champion v. Ames, supra; Lewis Publishing Co. v. Morgan, 229 U. S. 288. In the instant case, the penalty attaches to the use of the instrumentalities of commerce and of the mails by those who, engaged in that use, refuse to submit to § 5 and thus through registration and the statement which is incident to registration to supply the information which Congress is entitled to demand, and has demanded, with respect to their organization and practices. Each one of the paragraphs of § 4 (a), as related to the requirements of § 5, is addressed to those in that class. We think 419 ELECTRIC BOND CO. v. COMM’N. 443 Opinion of the Court. that the imposition of such a penalty does not transgress any constitutional provision. The decree enforces this penalty by injunction as the Act itself authorizes. § 18 (f). The terms of the injunction follow closely the provisions of § 4 (a) and do not extend beyond them. To escape the penalty and the enforcing provisions of the decree, ail that the défendants hâve to do is to register with the Commission and assume, under § 5, the obligation to file the described registration statement. Ail their rights and remedies with respect to other provisions of the statute remain without préjudice. Their objections to the affirmative provisions of the decree are untenable. Fourth. The District Court did not err in dismissing the cross bill. Défendants are not entitled to invoke the Fédéral Declaratory Judgment Act in order to obtain an ad-visory decree upon a hypothetical state of facts. See New Jersey v. Sargent, 269 U. S. 328; United States v. West Virginia, 295 U. S. 4'63; Ashwander v. Tennessee Valley Authority, 297 U. S. 288, 324; Anniston Manufacturing Co. v. Davis, 301 U. S. 337, 355. By the cross bill, défendants seek a judgment that each and every provision of the Act is unconstitutiorial. It présents a variety of hypothetical controversies which may ne ver become real. We are invited to enter into a spéculative inquiry for the purpose of condemning statutory provisions the effect of which in concrète situations, not yet developed, cannot now be definitely perceived. We must décliné that invitation. Anniston Manufacturing Co. v. Davis, supra. The decree is Affirmed. Mr. Justice McReynolds dissents. Mr. Justice Cardozo and Mr. Justice Reed took no part in the considération and decision of this case. 444 OCTOBER TERM, 1937. Argument for Appellee. 303 U. S. LOVELL v. CITY OF GRIFFIN. APPEAL FROM THE COURT OF APPEALS OF GEORGIA. No. 391. Argued February 4, 1938.—Decided March 28, 1938. 1. Whether a fédéral question was properly presented to and decided by a state court is itself a fédéral question, to be decided by this Court upon appeal. P. 450. 2. Freedom of speech and freedom of the press, which are protected by the First Amendment from infringement by Congress, are among the fundamental personal rights and liberties which are protected by the Fourteenth Amendment from invasion by state action. P. 450. 3. Municipal ordinances adopted under state authority constitute state action within the meaning of the Fourteenth Amendment. P. 450. 4. A city ordinance forbidding as a nuisance the distribution, by hand or otherwise, of literature of any kind without first obtain-ing written permission from the City Manager, violâtes the Fourteenth Amendment; strikes at the very foundation of the freedom of the press by subjecting it to license and censorship. P. 450. So held as applied to distribution of pamphlets and magazines in the nature of religious tracts. 5. The liberty of the press is not confined to newspapers and periodi-cals. It embraces pamphlets and leaflets. P. 452. 6. One who is prosecuted for disobeying a license ordinance which is void on its face may contest its validity without having sought a permit under it. P. 452. 55 Ga. App. 609; 191 S. E. 152, reversed. Appeal from a judgment affirming a sentence imposed for violation of a city ordinance. The Suprême Court of the State denied a review. Mr. O. R. Moyle for appellant. Messrs. Hughes Spalding and Sumter M. Kelley submitted on brief for appellee. This ordinance is a police measure which deals with the practice of distributing circulars, handbooks, adver- 444 LOVELL v. GRIFFIN. Argument for Appellee. 445 tising and other literature within the city limits. If it be kept in mind that every municipality is faced with a sanitary problem in removing from its streets papers, circulars and other like materials, the reasons for the adoption of such an ordinance become apparent. Clearly there is a permissible field for such a régulation within constitutional limitations. Nothing in the ordinance is aimed at or relates to the right to worship as one may prefer, or the right to speak or write with complété free-dom. The fact the appellant may hâve in her own mind associated her forbidden activities with her religious convictions does not establish any legal or constitutional connection between them. Commonwealth v. Plaisted, 148 Mass. 375; Smith v. People, 51 Colo. 271; State v. Marble, 72 Ohio St. 21 ; Streitch v. Board of Education, 34 S. D. 169; State v. Big Sheep, 75 Mont. 219; McMas-ters v. State, 21 Okla. Crim. 318; Reynolds v. United States, 98 U. S. 145; State v. Neitzel, 69 Wash. 567; Commonwealth v. Herr, 229 Pa. St. 132. Appellant is not a member of the press. The record in this case does not place her in the class of persons who are entitled to invoke the constitutional provisions touching the freedom of the press. Moreover, she was not convicted for anything she was speaking or writing. Neither does the ordinance prohibit her from speaking or writing as her judgment may- dictate. The require-ment of the ordinance that she is not to distribute printed matter which others hâve published, without a permit, involves in no way the constitutional right of free speech. Iroquois Transportation Co. v. DeLaney Co., 205 U. S. 354 ; Lee v. New Jersey, 207 U. S. 67 ; Fidelity & Casualty Co. v. Freeman, 109 F. 847; Missouri, K. de T. R. Co. v. Cade, 233 U. S. 642. The ordinance does restrict the right to distribute circulars, advertising matter and other literature in the city, in the absence of a permit from the City Manager. 446 OCTOBER TERM, 1937. Argument for Appellee. 303 U. S. It is urged that this restraint involves a déniai of due process and the equal protection of the law, in that the City Manager is clothed with unqualified discrétion in granting or denying the permit. This is scarcely a déniai of the equal protection of the law, since it applies in like manner to ail persons. A substantial question as to due process might hâve been involved in the case except for the following essential facts, to-wit : (a) Appellant failed to raise in any proper manner the issue of due process in the trial court. The Court of Appeals so ruled, and rightly. Coleman v. Griffin, 55 Ga. App. 123; Curtis n. Helen, 171 Ga. 256; Jordan v. State, 172 Ga. 857; Palmer v. Phinizy, 151 Ga. 589; Louisville & N. Ry. Co. v. Woodford, 234 U. S. 46. (b) Appellant did not apply to the City Manager for a permit. She is not in a position of having suffered from the exercise of the arbitrary and unlimited power of which she complains. Had she made application for a permit and had she been denied one without adéquate reason, her constitutional rights would hâve been in-fringed. She seeks to claim the benefit of the presumption that an application by her for a permit would hâve been denied. Nothing in the record justifies such an assump-tion. The fact that the City Manager is clothed with arbitrary power, if it be a fact, affords the appellant no ground of complaint unless and until she has suffered from the exercise of this power. It is submitted that it is proper for the city to provide by ordinance that ail persons dis-tributing materials described by the ordinance be required to apply for a permit. If so, no person desiring to engage in this activity can suffer any legal wrong by reason of the ordinance until the application for a permit has been denied. Until the contrary appears from expérience, it will be presumed that ail persons legally entitled to a permit will be granted one. Had the appellant applied for one and been denied without substantial cause, a LOVELL v. GRIFFIN. 447 444 Opinion of the Court. question of due process would hâve arisen. Even then, it would be necessary, in order to get a hearing in this Court, for the appellant to raise this question in the manner required by the accepted rules of practice, and this she has not done. By leave of Court, briefs of amici curiae were filed by Messrs. Francis Biddle and Osmond K. Fraenkél, on behalf of the American Liberties Union, and by Messrs. Samuel Slaff and George Slaff, on behalf of the Workers’ Defense League, in support of appellant. Mr. Chief Justice Hughes delivered the opinion of the Court. Appellant, Alma Lovell, was convicted in the Recorder’s Court of the City of Griffin, Georgia, of the violation of a city ordinance and was sentenced to imprisonment for fifty days in default of the payment of a fine of fifty dollars. The Superior Court of the county refused sanction of a pétition for review; the Court of Appeals af-firmed the judgment of the Superior Court (55 Ga. App. 609; 191 S. E. 152) ; and the Suprême Court of the State denied an application for certiorari. The case cornes here on appeal. The ordinance in question is as follows: “Section 1. That the practice of distributing, either by hand or otherwise, circulars, handbooks, advertising, or literature of any kind, whether said articles are being delivered free, or whether same are being sold, within the limits of the City of Griffin, without first obtaining writ-ten permission from the City Manager of the City of Griffin, such practice shall be deemed a nuisance, and punishable as an offense against the City of Griffin. “Section 2. The Chief of Police of the City of Griffin and the police force of the City of Griffin are hereby required and directed to suppress the same and to abate 448 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. any nuisance as is described in the first section of this ordinance.” The violation, which is not denied, consisted of the distribution without the required permission of a pamphlet and magazine in the nature of religions tracts, setting forth the gospel of the “Kingdom of Jéhovah.” Appellant did not apply for a permit, as she regarded herself as sent “by Jéhovah to do His work” and that such an application would hâve been “an act of disobedience to His commandment.” Upon the trial, with permission of the court, appellant demurred to the charge and moved to dismiss it upon a number of grounds, among which was the contention that the ordinance violated the Fourteenth Amendment of the Constitution of the United States in abridging “the freedom of the press” and prohibiting “the free exercise of petitioner’s religion.” This contention was thus expressed : “Because said ordinance is contrary to and in violation of the first amendment. to the Constitution of the United States, which reads: ‘Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof, or abridging the freedom of speech or of the press; or the right of the people peaceably to assemble and to pétition the government for a redress of grievances.’ “Said ordinance is also contrary to and in violation of the fourteenth amendment to the Constitution of the United States, which had the effect of making the said first amendment applicable to the States, and which reads : ‘Ail persons born or naturalized in the United States, and subject to the jurisdiction thereof, are citizens of the United States, and of the State wherein they résidé. No State shall make or enforce any law which shall abridge the privilèges or immunities of citizens of the United 444 LOVELL v. GRIFFIN. Opinion of the Court. 449 States; nor shall any State deprive any person of life, liberty, or property without due process of law ; nor deny to any person within its jurisdiction the equal protection of the laws.’ “Said ordinance absolutely prohibits the distribution of any literature of any kind within the limits of the City of Griffin without the permission of the City Manager and thus abridges the freedom of the press, contrary to the provisions of said quoted amendments. “Said ordinance also prohibits the free exercise of peti-tioner’s religion and the practice thereof by prohibiting the distribution of literature about petitioner’s religion in violation of the terms of said quoted amendments.” The Court of Appeals, overruling these objections, sus-tained the constitutional validity of the ordinance, saying— “The ordinance is not unconstitutional because it abridges the freedom of the press or prohibits the distribution of literature about the petitioner’s religion, in violation of the fourteenth amendment to the constitution of the United States.” While in a separate paragraph of its opinion the court said that the charge that the ordinance was void because it violated a designated provision of the state or fédéral constitution without stating wherein there was such a violation, was too indefinite to présent a constitutional question, we think that this statement must hâve referred to other grounds of demurrer and not to the objection above quoted which was sufficiently spécifie and was defi-nitely ruled upon. The contention as to restraint “upon the free exercise of religion,” with respect to the same ordinance, was presented in the case of Coleman v. City of Griffin, 55 Ga. App. 123, and the appeal was dismissed for want of a substantial fédéral question, 302 U. S. 636. Reynolds v. United States, 98 U. S. 145, 166, 167; Davis 53383°—38----------29 450 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. v. Beason, 133 U. S. 333, 342, 343. But, in the Coleman case, the Court did not deal with the question of freedom of speech and of the press, as it had not been properly presented. We think that this question was adequately presented and was decided in the instant case. Whether it was so presented and was decided is itself a fédéral question. Carter v. Texas, 177 U. S. 442, 447; Ward v. Love County, 253 U. S. 17, 22; First National Bank v. Anderson, 269 U. S. 341, 346; Schuylkïll Trust Co. v. Pennsylvania, 296 U. S. 113, 121. This Court has jurisdiction. Freedom of speech and freedom of the press, which are protected by the First Amendment from infringement by Congress, are among the fundamental personal rights and liberties which are protected by the Fourteenth Amendment from invasion by state action. Gitloiv v. New York, 268 U. S. 652, 666; Stromberg v. California, 283 U. S. 359, 368; Near v. Minnesota, 283 U. S. 697, 707; Gros-jean v. American Press Co., 297 U. S. 233, 244; De Jonge v. Oregon, 299 U. S. 353, 364. See, also, Palko v. Connecticut, 302 U. S. 319. It is also well settled that municipal ordinances adopted under state authority constitute state action and are within the prohibition of the amendment. Raymond v. Chicago Union Traction Co., 207 U. S. 20; Home Téléphoné & Telegraph Co. v. Los Angeles, 227 U. S. 278; Cuyahoga River Power Co. N. Akron, 240 U. S. 462. The ordinance in its broad sweep prohibits the distribution of “circulars, handbooks, advertising, or litera-ture of any kind.” It manifestly applies to pamphlets, magazines and periodicals. The evidence against appellant was that she distributed a certain pamphlet and a magazine called the “Golden Age.” Whether in actual administration the ordinance is applied, as apparently it could be, to newspapers does not appear. The City Manager testified that “every one applies to me for a 444 LOVELL v. GRIFFIN. Opinion of the Court. 451 license to distribute literature in this City. None of these people (including défendant) secured a permit from me to distribute literature in the City of Griffin.” The ordinance is not limited to “literature” that is obscene or offensive to public morals or that advocates unlawful con-duct. There is no suggestion that the pamphlet and magazine distributed in the instant case were of that charac-ter. The ordinance embraces “literature” in the widest sense. The ordinance is comprehensive with respect to the method of distribution. It covers every sort of circulation “either by hand or otherwise.” There is thus no restriction in its application with respect to time or place. It is not limited to ways which might be regarded as incon-sistent with the maintenance of public order or as in-volving disorderly conduct, the molestation of the inhabitants, or the misuse or littering of the streets. The ordinance prohibits the distribution of literature of any kind at any time, at any place, and in any manner with-out a permit from the City Manager. We think that the ordinance is invalid on its face. Whatever the motive which induced its adoption, its character is such that it strikes at the very foundation of the freedom of the press by subjecting it to license and censorship. The struggle for the freedom of the press was primarily directed against the power of the licensor. It was against that power that John Milton directed his as-sault by his “Appeal for the Liberty of Unlicensed Print-ing.” And the liberty of the press became initially a right to publish “without a license what formerly coùld be published only with one.” 1 While this freedom from previous restraint upon publication cannot be regarded as exhausting the guaranty of liberty, the prévention of that restraint was a leading purpose in the adoption of the 1 See Wickwar, “The Struggle for the Freedom of the Press,” p. 15. 452 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. constitutional provision. See Patterson v. Colorado, 205 U. S. 454, 462; Near v. Minnesota, 283 U. S. 697, 713-716; Grosjean v. American Press Co., 297 U. S. 233, 245, 246. Législation of the type of the ordinance in question would restore the System of license and censorship in its baldest form. The liberty of the press is not confined to newspapers and periodicals. It necessarily embraces pamphlets and leaflets. These indeed hâve been historié weapons in the defense of liberty, as the pamphlets of Thomas Paine and others in our own history abundantly attest. The press in its historié connotation comprehends every sort of publication which affords a vehicle of information and opinion. What we hâve had recent occasion to say with respect to the vital importance of protecting this essential liberty from every sort of infringement need not be repeated. Near v. Minnesota, supra; Grosjean v. American Press Co., supra; De Jonge v. Oregon, supra.2 The ordinance cannot be saved because it relates to distribution and not to publication. “Liberty of circu-lating is as essential to that freedom as liberty of pub-lishing; indeed, without the circulation, the publication would be of little value.” Ex parte Jackson, 96 U. S. 727, 733. The license tax in Grosjean n. American Press Co., supra, was held invalid because of its direct tendency to restrict circulation. As the ordinance is void on its face, it was not neces-sary for appellant to seek a permit under it. She was 2 See also, Starr Company v. Brush, 185 App. Div. (N. Y.) 261 ; 172 N. Y. S. 851; Dearborn Publishing Co. v. Fitzgerald, .271 Fed. 479; In re Campbell, 64 Cal. App. 300 ; 221 Pac. 952; Coughlin v. Sullivan, 100 N. J. L. 42; 126 Atl. 177. Compare People v. Armstrong, 73 Mich. 288; 41 N. W. 275; Chicago n. Schvltz, 341 111. 208; 173 N. E. 276; People n. Armentrout, 118 Cal. App. Supp. 761; 1 P. 2d 556. SANTA CRUZ CO. v. LABOR BOARD. 453 444 Syllabus. entitled to contest its validity in answer to the charge against her. Smith v, Cahoon, 283 U. S. 553, 562. The judgment is reversed and the cause is remanded for further proceedings not inconsistent with this opinion. Reversed. Mr. Justice Cardozo took no part in the considération and decision of this case. SANTA CRUZ FRUIT PACKING CO. v. NATIONAL LABOR RELATIONS BOARD. CERTIORARI TO THE CIRCUIT COURT OF APPEALS FOR THE NTNTH CIRCUIT. No. 536. Argued March 7, 1938.—Decided March 28, 1938. 1. A corporation was engaged, in California, in the business of can-ning fruits and vegetables, raised in the State, and in disposing of its large output locally and in interstate and foreign commerce, 37% going to destinations beyond the State, partly on f. o. b. ship-ment and much of it by water. The goods shipped by boat were carried to the wharves on trucks loaded at the plant by ware-housemen employed there. Many of these, upon being locked out by the company for having joined a labor union, formed a picket line, and this was so maintained that eventually the movement of trucks from warehouse to wharves ceased entirely. The teamsters refused to haul, the warehousemen at the dock warehouses de-clined to handle, and. the stevedores between dock and ship refused to load, the company’s goods. The National Labor Relations Board found that the discharge of the employées and the refusai to reinstate them constituted an unlawful discrimination under the National Labor Relations Act and that the acts of the company tended to lead, and had led, to labor disputes burdening and obstructing interstate commerce. It ordered the company to desist from such practices, to reinstate, with back pay, the dis-charged employées, and to post notices, etc. Held that the case was within the jurisdiction of the Board and that the order was properly sustained by the Circuit Court of Appeals. Pp. 463 et seq. 454 OCTOBER TERM, 1937. Syllabus. 303 U. S. 2. Sales to purchasers in another State are not withdrawn from fédéral control because the goods are delivered f. o. b. at stated points within the State of origin for transportation. P. 463. 3. The fédéral power to protect interstate commerce in commodities does not dépend upon their kind and has been applied to the practices of manufacturers, processors and labor unions. Carter v. Carter Coal Co., 298 U. S. 238, did not establish a different principle or overrule the earlier decisions. P. 466. 4. The power of Congress to protect interstate commerce in manu-factured articles from burdens and obstructions springing from labor disputes in the factory is not dépendent upon an origin outside of the State of the raw materials used in the manufactur-ing process; nor is the place where the manufacturer makes his sales a controlling element, if the sales in fact are in interstate commerce. National Labor Relations Board v. Jones & Laughlin Steel Corp., 301 U. S. 1. P. 464. 5. Cases respecting the state power to tax goods which hâve not begun to move in interstate commerce, or hâve corne to rest within the State, or to adopt local police measures affecting them, do not deal with the extent of the power of Congress over interstate commerce but are concerned with the question whether a particular exercise of state power, in view of its nature and operation, must be deemed to be in conflict with that paramount authority. P. 466. 6. Where fédéral control is sought to be exercised over activities which separately considered are intrastate, it must appear that there is a close and substantial relation to interstate commerce in order to justify the fédéral intervention for its protection. P. 466. 7. This principle is essential to the maintenance of our constitutional System. Id. 8. In maintaining the balance of the constitutional grants and limitations, it is inévitable that we should define their applications in the graduai process of inclusion and exclusion. And what is rea-sonably clear in a particular application is not to be overbome by the simple and familiar dialectic of suggesting doubtful and extreme cases. P. 467. 9. The question whether the labor practices of an employer are practices “affecting commerce,” as defined by § 2 (6) of the National Labor Relations Act, can not be answered by mere reference to the percentage of the product sold in interstate and foreign commerce. The question that must be faced under the Act upon particular facts is whether the unfair labor practices involved hâve such a SANTA CRUZ CO. v. LABOR ÇOARD. 455 453 Argument for Petitioner. close and substantial relation to the freedom of interstate commerce from injurions restraint that these practices may constitu-tionally be made the subject of fédéral cognizance through provisions looking to the peaceable adjustment of labor disputes. P. 467. 91 F. 2d 790, affirmed. Certiorari, 302 U. S. 680, to review the affirmance of a judgment affirming in part an order of the National Labor Relations Board. Mr. J. Paul St. Sure for petitioner. Where there has been no antécédent movement of the raw products in commerce, the business of canning, label-ing, packing, storing and loading of fruit and vegetables produced wholly in California is not “in commerce.” A labor dispute therein cannot burden or obstruct a commerce which has not begun. Therefore the National Labor Relations Act does not apply and the Board had no jurisdiction. Carter v. Carter Coal Co., 298 U. S. 238; Schechter Poultry Corp. v. United States, 295 U. S. 495 ; Veazie v. Moor, 14 How. 568; Coe n. Errol, 116 TJ. S. 517; Kidd n. Pearson, 128 U. S. 1; Chassaniol v. Greenwood, 291 U. S. 584; Heisler N. Thomas Colliery Co., 260 U. S. 245; Oliver Mining Co. v. Lord, 262 U. S. 172; Utah Power & Light Co. n. Pjost, 286 U. S. 165; Lehigh Valley R. Co. v. Pennsylvania, 145 U. S. 192. Where small quantifies of a raw product are shipped into the State for canning and sale to local trade in California, the National Labor Relations Act does not apply for the reason that commerce in such product has ended, and the canning and subséquent handling are local affairs; and labor disputes in such affairs do not directly burden or obstruct commerce. Schechter Poultry Corp. n. United States, supra; East Ohio Gas Co. v. Tax Commission, 283 U. S. 465; Public Utilities Comm’n v. Landon, 249 U. S. 236; Atlantic Coast Line v. Standard 456 OCTOBER TERM, 1937. Argument for Petitioner. 303 U. S. Oil Co., 275 U. S. 257; Industrial Assn. of San Francisco N. United States, 268 U. S. 64. Unless this Court is willing to go so far as to say that the power of Congress extends over ail labor disputes involving production industries, the Board did not hâve jurisdiction in this case, for the reason that the constitutional power of Congress cannot be made to dépend on the intention of the producer to sell its prod-uct in interstate or foreign commerce, or the fortuitous circumstance that he may ultimately sell a part of such product outside the State wherein it is produced. Kidd N. Pearson, 128 U. S. 1; Champlin Refining Co. v. Corporation Commission, 286 U. S. 210; Fédéral Compress & W. Co. v. McLean, 291 U. S. 17; Oliver Mining Co. v. Lord, supra; Chassaniol v. Greenwood, supra; Heisler v. Thomas Collier g Co., supra; Arkadelphia Milling Co. N. St. Louis S. W. R. Co., 249 U. S. 134; Carter v. Carter Coal Co., supra. The désignation of petitioner’s produce as “hot cargo” by the International Longshoremen’s Association and the refusai of such association to handle such product was an unlawful conspiracy in violation of the Fédéral Anti-Trust Act and a violation of the Sloss Arbitration Award ; and any burden or obstruction to commerce resulting therefrom is indirect and remote and does not extend the power of Congress or the jurisdiction of the Board over petitioner’s production business. Bedford Cut Stone Co. v. Journeymen S. C. Assn., 274 U. S. 37; Duplex Print-ing Press Co. v. Deering, 254 U. S. 443; Coronado Coal Co. v. United Mine Workers, 268 U. S. 295; Lowe v. Lawlor, 208 U. S. 274; Anderson v. Ship Owners Assn., 272 U. S. 359; Local 167 I. B. T. v. United States, 291 U. S. 293. The instant case is not in any respect comparable to the cases wherein this Court had held that by reason of the SANTA CRUZ CO. v. LABOR BOARD. 457 453 Argument for Respondent. effects or burdens on interstate commerce the power of Congress extends to the régulation of intrastate affairs. Rate Cases: Houston E. & W. T. R. Co. v. United States, 234 U. S. 342 ; Florida v. United States, 282 U. S. 194; Railroad Commission v. Chicago, B. & Q. R. Co., 257 U. S. 563. Board of Trade and Stockyards Cases: Board of Trade v. Olsen, 262 U. S. 1; Hill v. Wallace, 259 U. S. 44; Swift & Co. v. United States, 196 U. S. 375; Stafford v. Wallace, 258 U. S. 495; Tagg Bros. & Moorhead v. United States, 280 U. S. 420. Railway Appliance, Employers’ Liability, and Railway Labor Cases: Southern R. Co. v. United States, 222 U. S. 20; Baltimore & O. R. Co. v. Interstate Commerce Comm’n, 221 U. S. 612; Mondou v. New York, N. H. & H. R. Co., (Second Employers’ Liability Cases), 223 U. S. 1 ; Texas & N. O. R. Co. v. Brotherhood of R. & S. S. Clerks, 281 U. S. 548; Virginian R. Co. v. System Fédération No. 40, 300 U. S. 515. Anti-Trust Cases: Standard Oil Co. v. United States, 221 U. S. 1 ; United States v. American Tobacco Co., 221 U. S. 106; Addyston Pipe & Steel Co. v. 'United States, 175 U. S. 211. Mr. Charles Fahy, with whom Solicitor General Reed, Assistant Solicitor General Bell, and Messrs. Robert L. Stem, Robert B. Watts, Laurence A. Knapp and Philip Levy were on the brief, for respondent. Petitioner is engaged in canning, packing, and shipping fruit and vegetables in Oakland, California. It is the fourth or fifth in size of such canneries in that State, which is the center of the canning industry in the United States; and annually ships large quantities of its prod-ucts in interstate and foreign commerce. Stoppage of operations as a resuit of industrial strife in petitioner’s plant would directly obstruct the movement of those 458 OCTOBER TERM, 1937. Argument for Respondent. 303 U. S. commodities in interstate and foreign commerce. There thus exists a “close and intimate” relation between peti-tioner’s operations and the flow of commerce; and the National Labor Relations Act accordingly may validly be applied to petitioner’s plant. National Labor Relations Board v. Jones & Laughlin Steel Corp., 301 U. S. 1, 41. 1. This conclusion is not affected by the fact that the products processed by petitioner are grown in California. In the Jones & Laughlin case the Court expressly stated that its decision did not turn on the conception that the manufacturing process was carried on in a “stream” or “flow” of commerce, wherein the raw materials arriving from without the State came to rest temporarily at the plant and later went forward again in interstate commerce (301 U. S. at 36). The contention that the stream of commerce had been broken, the Court held was not relevant to the issue involved (301 U. S. at 41). The determinative factor was the obstructing effect of industrial strife upon the interstate movement of goods. Carter v. Carter Coal Co., 298 U. S. 238, does not support petitioner’s contention. The Carter decision did not pur-port to rest on the différence between mining operations and manufacturing enterprises which utilize raw materials obtained through the channels of interstate commerce. Nor did this Court in the Jones & Laughlin case, in holding that the Carter case was not controlling, suggest that it was to be distinguished upon such a ground. The danger of an obstruction to interstate commerce, and the ap-propriateness of the means adopted by the Congress to remove it, were the décisive factors in each decision. The Jones & Laughlin decision establishes that the Congress has power to prevent the obstruction to interstate commerce caused by the unfair labor practices con-demned in the présent Act. Neither the fact nor the degree of obstruction to commerce in manufactured prod- SANTA CRUZ CO. v. LABOR BOARD. 459 453 Argument for Respondent. ucts can in reason dépend upon the place of origin of the raw materials. As this Court stated in the Jones & Laugh-lin case, Congressional authority over interstate commerce extends to the protection of such commerce “no matter what the source of the dangers which threaten it” (301 U. S. at 36-37). No distinction can properly be drawn between activities which obstruct interstate commerce in raw materials, in manufactured products, or both. The géographie fact of concentration of natural resources in particular régions, far from lessening national concern in the industries immediately dépendent upon those resources, heightens it. It does so none the less because of the natural, if not necessary, circumstance of the location of such industries at the point of concentration of the resources. The view which petitioner urges would frustrate one of the great purposes of the commerce power as realized in this statute, by removing from the reach of Congressional protection industries whose operations in interstate and foreign commerce are of vital importance to the national welfare and whose interruption or cessation by industrial strife would create problems of the deepest national concern. 2. Approximately 37 per cent, of the product of peti-tioner’s plant is shipped in interstate or foreign commerce. The same employées préparé and ship both the goods which go to points outside California and those which do not. No séparation of the employées into those working on goods destined for interstate shipment and those working on goods to be consumed in California is possible. Congress has power to regulate both interstate and intra-state activities when they are inseparably intermingled in this way. Shreveport Case, 234 U. S. 342. The suggestion that the power of Congress over such intermingled transactions disappears if more than 50 per cent, of the transactions are intrastate would establish an arbitrary and impractical rule of thumb in violation of the funda- 460 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. mental principle of the supremacy of fédéral power. A review of the decisions in which this Court has sustained fédéral régulation of intrastate activities because of their deleterious effects upon commerce demonstrates that the validity of such législation has never turned upon whether the interstate commerce affected was greater in quantity than the intrastate transactions which were necessarily subjected also to the régulation imposed. Clearly, protection to interstate commerce need not be withheld because in affording that protection intrastate commerce is also safeguarded. By leave of Court, Messrs. H. W. O’Melveny, Walter K. Tuller, and Louis W. Myers filed a brief as amici curiae, supporting petitioner. Mr. Chief Justice Hughes delivered the opinion of the Court. The National Labor Relations Board on April 2, 1936, after hearing, found that petitioner, Santa Cruz Fruit Packing Company, a California corporation, had been en-gaged in unfair labor practices affecting commerce within the meaning of § 8, subdivisions (1) and (3) and § 2, subdivisions (6) and (7) of the National Labor Relations Act, and ordered petitioner to desist from such practices, to reinstate with back pay certain employées who had been discharged, and to post appropriate notices. 1 N. L. R. B. 454. Upon pétition of the Board, the Circuit Court of Appeals affirmed the order so far as it related to petition-er’s employées at its Oakland plant. 91 F. (2d) 790. In view of the importance of the question with respect to the application of the National Labor Relations Act, this Court granted certiorari. There is no dispute as to the pertinent facts. The findings of the Board, supported by evidence, show the following: Petitioner is engaged at its plant at Oakland in canning, packing and shipping fruit and vegetables, the bulk of SANTA CRUZ CO. v. LABOR BOARD. 461 453 Opinion of the Court. which are grown in that State. During the “peak” season, petitioner employs from 1200 to 1500 persons of whom about 30 are warehousemen. The total “pack” in the year 1935 amounted to about 1,699,270 cases. Of this amount about 37 per cent, were shipped in interstate or foreign commerce, 9.02 per cent, being sent to foreign coun-tries and approximately 473,620 cases, or about 27.89 per cent, to various points in the United States outside California. The sales to purchasers outside the State were under either f. o. b. or c. i. f. San Francisco Bay Point contracts. The methods of transportation are by water, rail and truck. Export shipments go by water and this is also the chief sort of carriage to points within the United States outside California, about 20 per cent, being shipped by rail and an undetermined amount by truck directly to the point of destination. “There is a constant stream of load-ing and shipping of products” out of petitioner’s plants throughout the entire year. From 3,000 to 4,000 cases are loaded daily in the various vehicles of conveyance. That loading is a substantial and regular part of the work of the warehousemen in petitioner’s employ. When the shipments are by rail or overland trucks, these employées load directly into the equipment of the principal carriers. When shipments are by boat, the warehousemen load the cases into the trucks which carry the goods to the docks. Weighers, Warehousemen and Cereal Workers Local 38-44, International Longshoremen’s Association, is a labor organization affiliated with the American Fédération of Labor. Its efforts to organize the Oakland plant were begun in July, 1935, and many of the permanent warehousemen made application for membership. When this came to the attention of petitioner early in August, the General Manager announced that he would not permit a union in the plant because of compétitive conditions. On their return from a union meeting at which the men 462 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. were to be initiated, members of the night shift were pre-vented from entering the plant and the next morning the members of the day crew were similarly excluded. A picket line then formed, on the morning of August 8th, was maintained until September 27th with such effective-ness that eventually the movement of trucks from ware-houses to wharves ceased entirely. The Board found: “The teamsters refused to haul Santa Cruz merchandise ; the warehousemen at the dock warehouses who ordinarily unload the canned goods from the cars prior to their re-loading into the ships, since they were members of the same union as the Santa Cruz warehousemen, also declined to handle Santa Cruz cargo. As members of the sister union, I. L. A. 38-79, the stevedores who move the goods from dock to ship also refused to move Santa Cruz cargo both at the East Bay and San Francisco docks during the entire period that the picket line was maintained. Other unions whose members refused to move ‘hot’ Santa Cruz cargo were those members of the Sailors who comprised the crews of steam schooners and whose duties include the handling of cargo.” Petitioner points out that the refusai of the other unions to handle petitioner’s goods was a violation of an arbitration award made in October, 1934, following the San Francisco maritime strike of that year. The Board found that interférence with the activities of employées in forming or joining labor organizations results in strikes and industrial unrest which habitually hâve had the effect in the canning industry of impeding the movement of canned products in interstate and for-eign commerce. Référencé was made to official statistics of the United States Department of Labor in relation to the canning and preserving industries from which it ap-peared that of the fifteen strikes and lockouts in 1934, and the first six months of 1935, eight were the outcome of difficulties in regard to union récognition and discrimi- SANTA CRUZ CO. v. LABOR BOARD 463 453 Opinion of the Court. nation for union activities, 7,484 workers being involved in those stoppages. The Board concluded that the discharge of the employées named and the refusai to reinstate them consti-tuted an unlawful discrimination under the National Labor Relations Act and that the acts of petitioner had led and tended to lead to labor disputes burdening and obstructing commerce. Petitioner contends that the manufacturing and Processing in which petitioner is engaged are local activities and that the Board was without jurisdiction over the labor dispute involved in this case. First. There is no question that petitioner was directly and largely engaged in interstate and foreign commerce. We hâve often decided that sales to purchasers in an-other State are not withdrawn from fédéral control because the goods are delivered f. o. b. at stated points within the State of origin for transportation. See Savage n. Jones, 225 U. S. 501, 520; Texas & N. O. R. Co. v. Sabine Tram Co., 227 U. S. 111, 114, 122; Pennsylvania R. Co. v. Clark Bros. Coal Mining Co., 238 U. S. 456, 465-468. A large part of the interstate commerce of the country is conducted upon that basis and the arrangements that are made between seller and purchaser with respect to the place of taking title to the commodity, or as to the payment of freight, where the actual movement is interstate, do not affect either the power of Congress or the jurisdiction of the agencies which Congress has established. Pennsylvania R. Co. v. Clark Bros. Coal Mining Co., supra. Second. The power of Congress extends not only to the making of rules governing sales of petitioner’s products in interstate commerce, as, for example, with respect to misbranding under the Fédéral Food and Drugs Act (21 U. S. C., §§ 1 to 26), or with respect to forbidden dis- 464 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. criminations in prices under the Clayton Act (15 U. S. C. 13), but also to the protection of that Interstate commerce from burdens, obstructions and interruptions, what-ever may be their source. Second Employers’ Liability Cases, 223 U. S. 1, 51. The close and intimate effect which brings the subject within the reach of fédéral power may be due to activities in relation to productive indus-try, although that industry when separately viewed is local. It is upon this well-established principle that the constitutional validity of the National Labor Relations Act has been sustained. National Labor Relations Board v. Jones & Laughlin Steel Corp., 301 U. S. 1, 38. Petitioner urges that the principle is inapplicable here as the fruits and vegetables which petitioner préparés for shipment are grown in California and petitioner’s operations are confined to that State. It is not a case where the raw materials of production are brought into the State of manufacture and the manufactured product is handled by the manufacturer in other States. In view of the Interstate commerce actually carried on by petitioner, the conclusion sought to be drawn from this distinction is without merit. The existence of a continuous flow of Interstate commerce through the State may indeed readily show the intimate relation of particular transactions to that commerce. Stafford N. Wallace, 258 U. S. 495, 516; Chicago Board of Trade v. Olsen, 262 U. S. 1, 33. But, as we said in the Jones & Laughlin case, the instances in which the metaphor of a “stream of commerce” has been used are but particular, and not exclusive, illustrations of the protective power which Congress may exercise. “The congressional authority to protect Interstate commerce from burdens and obstructions is not limited to transactions which can be deemed to be an essential part of a 'flow’ of interstate or foreign commerce. Burdens and obstructions may be due to injuri-ous actions springing from other sources.” Id., p. 36. SANTA CRUZ CO. v. LABOR BOARD. 465 453 Opinion of the Court. Such injurious action burdening and obstructing interstate trade in manufactured articles may spring from labor disputes irrespective of the origin of the materials used in the manufacturing process. And the place where the manufacturer makes his sales is not controlling if the sales in fact are in interstate commerce. A few illustrations, from our many decisions, will suf&ce. In Loewe v. Lawlor [1908], 208 U. S. 274, 302, the conspiracy of the “United Hatters,” to compel the plaintiffs to unionize their factory, was held to fall within the Fédéral Anti-Trust Act because it was aimed at the destruction of the interstate trade in the manufactured hats. In United Mine Workers v. Coronado Co. [1922], 259 U. S. 344, 407, 408, the Court said that “Coal mining is not interstate commerce and the power of Congress does not extend to its régulation as such,” but that “if Congress deems certain recurring practices, though not really part of interstate commerce, likely to obstruct, restrain or burden it, it has the power to subject them to national supervision and restraint.” And in the second Coronado case [1925], 268 U. S. 295, 310, the Court held that the evidence was adéquate to show that the purpose was to stop the production of non-union coal and prevent its shipment to markets of other States, and that a combination to that end would constitute a direct violation of the Anti-Trust Act. Another illustration is found in Bedjord Cut Stone Co. v. Journeymen Stone Cutters’ Assn. [1927], 274 U. S. 37, 48, where a conspiracy of stone cutters was held to hâve “the immédiate purpose and necessary effect of restraining future sales and shipments in interstate commerce” of the building stone which was quarried at petitioner’s plants. With respect to the fédéral power to protect interstate commerce in the commodities produced, there is obviously no différence between coal mined, or stone quarried, and fruit and vegetables grown. The same principle must apply, and has been applied, to injurious restraints of 53383°—38----------30 466 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. interstate trade which are caused by the practices of man-ufacturers and processors. Standard Oil Co. v. United States, 221 U. S. 1; United States v. American Tobacco Co., 221 U. S. 106. The case of Carter v. Carter Coal Co., 298 U. S. 238, did not establish a different principle or overrule the decisions which we hâve cited. See National Labor Relations Board v. Jones & Laughlin Steel Corp., supra, p. 41. Nor are the cases in point which are cited by petitioner with respect to the exercise of the power of the State to tax goods, which hâve not begun to move in interstate commerce or hâve corne to rest within the State, or to adopt police measures as to local matters. In that class of cases the question is not with respect to the extent of the power of Congress to protect interstate commerce, but whether a particular exercise of state power in view of its nature and operation must be deemed to be in conflict with that paramount authority. Bacon n. Illinois, 227 U. S. 504, 516; Stafford v. Wallace, supra, p. 526; Minnesota v. Blasius, 290 U. S. 1, 8. Third. It is also clear that where fédéral control is sought to be exercised over activities which separately considered are intrastate, it must appear that there is a close and substantial relation to interstate commerce in order to justify the fédéral intervention for its protection. However difficult in application, this principle is essential to the maintenance of our constitutional System. The subject of fédéral power is still “commerce,” and not ail commerce but commerce with foreign nations and among the several States. The expansion of enterprise has vastly increased the interests of interstate commerce but the constitutional différentiation still obtains. Schechter Corporation v. United States, 295 U. S. 495, 546. “Activities local in their immediacy do not become interstate and national because of distant repercussions.” Id., p. 554. To express this essential distinction, “direct” has been contrasted with “indirect,” and what is “remote” or “dis- SANTA CRUZ CO. v. LABOR BOARD. 467 453 Opinion of the Court. tant” with what is “close and substantial.” Whatever terminology is used, the criterion is necessarily one of de-gree and must be so defined. This does not satisfy those who seek for mathematical or rigid formulas. But such formulas are not provided by the great concepts of the Constitution such as “interstate commerce,” “due process,” “equal protection.” In maintaining the balance of the constitutional grants and limitations, it is inévitable that we should define their applications in the graduai process of inclusion and exclusion. There is thus no point in the instant case in a demand for the drawing of a mathematical line. And what is rea-sonably clear in a particular application is not to be over-borne by the simple and familiar dialectic of suggesting doubtful and extreme cases. The critical words of the provision of the National Labor Relations Act in dealing with the described labor practices are “affecting commerce,” as defined. § 2 (6). It is plain that the provision cannot be applied by a mere reference to percentages and the fact that petitioner’s sales in interstate and foreign commerce amounted to 37 per cent., and not to more than 50 per cent., of its production cannot be deemed control-ling. The question that must be faced under the Act upon particular facts is whether the unfair labor practices involved hâve such a close and substantial relation to the freedom of interstate commerce from injurions restraint that these practices may constitutionally be made the subject of fédéral cognizance through provisions look-ing to the peaceable adjustment of labor disputes. The question of degree is constantly met in other relations. It is met whenever the Interstate Commerce Commission is required to find whether an intrastate rate or practice of an interstate carrier causes an undue and unreasonable discrimination against interstate or foreign commerce. 49 U. S. C. § 13(4). The Shreveport Case, 234 U. S. 342, 351. It is met under the Fédéral Em-ployers’ Liability Act, where the question is whether the 468 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. employee’s occupation at the time of his injury is “in interstate transportation or work so closely related to such transportation as to be practically a part of it.” Chicago & N. W. Ry. Co. v. Boîte, 284 U. S. 74, 78, 79; New York, N. H. & H. R. Co. v. Bezue, 284 U. S. 415, 420. It is met in the enforcement of the Clayton Act in determining whether the effect of the described provisions in contracts for the sale of commodities is “to sub-stantially lessen compétition.” 15 U. S. C., 13,14. Standard Fashion Co. v. Magrane-Houston Co., 258 U. S. 346, 356, 357; Fédéral Trade Comm’n v. Raladam Co., 283 U. S. 643, 647, 648. Such questions cannot be escaped by the adoption of any artificial rule. Fourth. The direct relation of the labor practices and the resulting labor dispute in the instant case to interstate commerce and the injurious effect upon that commerce are fully established. The warehousemen in question were employed by petitioner in loading its goods either into the cars of carriers or into the trucks which trans-ported the goods to the docks for shipment abroad or to other States. The immediacy of the effect of the for-bidden discrimination against these warehousemen is strikingly shown by the findings of the Board. When the men found themselves locked out because of their joining the union, they at once formed a picket line and this was maintained with such effectiveness that eventu-ally “the movement of trucks from warehouse to wharves ceased entirely.” The teamsters refused to haul, the warehousemen at the dock warehouses declined to han-dle, and the stevedores between dock and ship refused to load, petitioner’s goods. These became, in the parlance of the men, “hot” cargo. Petitioner says that this was an unlawful conspiracy of those sympathizing with its discharged warehousemen, but it was the discrimination against them which led directly to the interférence SANTA CRUZ CO. v. LABOR BOARD. 469 453 Butler, J., dissenting. with the movement from the plant and elicited the support so effectively given. It would be difficult to find a case in which unfair labor practices had a more direct effect upon interstate and foreign commerce. The relief afforded by the Board, in requiring petitioner to desist from the unfair labor practices condemned by the Act and to reinstate the discharged employées with back pay, was properly sustained by the Circuit Court of Appeals, and its order is affirmed. Affirmed. Mr. Justice Cardozo and Mr. Justice Reed took no part in the considération and decision of this case. Mr. Justice Butler, dissenting. Carter v. Carter Coal Co., 298 U. S. 238, decided that Congress lacks power to regulate terms and conditions of employaient of those engaged in local production of com-modities sold and about to be shipped in interstate commerce. The circuit court of appeals found two questions for solution. One was whether upon that point the Carter case, in 1936, has been overruled by our decision in 1937 in Labor Board v. Jones & Laughlin, 301 U. S. 1. The second was whether the power extends to cases where only 39% of goods locally produced are shipped in interstate commerce. The court, one judge dissenting, upheld the order. Each of the judges wrote an opinion ; two held this Court has overruled the Carter case. If the decision of the Carter case upon the point stated stands, the Board’s order cannot be upheld. The lower court made its decision dépend upon that question. Save authoritatively to décidé it here, there was no reason for granting the writ. But the opinion just announced does not refer to the question. 470 OCTOBER TERM, 1937. Butler, J., dissenting. 303 U. S. In the Jones & Laughlin and companion cases, four dissenting Justices thought the Court then departed from well-established principles followed in the Carter case and quoted (p. 96) a passage from it expounding what it meant by “direct” effect on interstate commerce as dis-tinguished from what is “indirect.” And the dissenting opinion insisted (p. 97) that, under the Carter decision, the facts in those cases did not disclose any direct effect upon interstate commerce, and said : “A more remote and indirect interférence with interstate commerce or a more definite invasion of the powers reserved to the States is difficult, if not impossible, to imagine.” But the dissent failed to elicit from the Court any state-ment as to whether it meant to overrule the Carter case. The opinion does not discuss that case. It does, however, contain the following (p. 41) : “In the Carter case ... the Court was of the opinion that the provisions of the statute relating to production were invalid upon several grounds,—that there was improper délégation of legislative power, and that the requirements not only went be-yond any sustainable measure of protection of interstate commerce but were also inconsistent with due process. These [meaning the Schechter and Carter} cases are not controlling here.” The later decisions of this Court in-volving the power of Congress to deal with labor relations in local production do not refer to the Carter case. At least until this Court definitely overrules that decision, it should be followed. Upon the authority of that case, I would reverse the order of the circuit court of appeals on the ground that, as applied here, the Act is unconstitutional. Mr. Justice McReynolds concurs in this opinion. DEITRICK v. STANDARD SURETY CO. 471 Statement of the Case. DEITRICK, RECEIVER, et al. v. STANDARD SURETY & CASUALTY CO. CERTIORARI TO THE CIRCUIT COURT OF APPEALS FOR THE FIRST CIRCUIT. No. 455. Argued March 7, 8, 1938.—Decided March 28, 1938. 1. A defense of fraud, good against a national bank in an action to enforce a contract, is good against the bank’s receiver in such an action. P. 479. 2. The receiver of a national bank sought to enforce against a surety company, as contracts made to the bank, bonds purport-ing to hâve been executed by the company through a general agent and purporting to guarantee payment of certain notes held by the bank. The surety alleged and the proofs showed that the bonds were obtained by the bank through the fraud of the bank’s president in collusion with the surety’s agent. There was evidence that the agent knew the bonds would be shown to the bank directors and to any others entitled to inquire concerning the notes, for the purposes of déception. Held that the pleadings afforded no basis for a recovery by the receiver upon the theory that because the Comptroller and national bank examiners were deceived by the bonds to the injury of creditors, therefore the surety was estopped to deny their validity as against the receiver, représentative of such creditors. P. 479. 90 F. 2d 862, 866, affirmed. Certiorari, 302 U. S. 676, to review the affirmance of judgments and decrees of the District Court in actions at law brought by the predecessor of the above-named petitioner, receiver of a national bank, to recover from the surety company on bonds held by the bank, and in suits in equity brought by the surety company in a state court and subsequently removed, in which the surety sought to hâve the bonds canceled for fraud. The cases were heard in conjunction by the District Court, and evidence was taken and findings were made by an Auditor and Master. That court dismissed the actions and de-creed in the surety’s favor. 472 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. Messrs. George P. Barse and Robert E. Goodwin, with whom Messrs. Richard M. Nichols, James Louis Robertson, and Trevor V. Roberts were on the brief, for peti-tioners. Messrs. Frédéric H. Chase and Raymond P. Baldwin, with whom Mr. Frank H. Stewart was on the brief, for respondent. Mr. Justice McReynolds delivered the opinion of the Court. The Boston-Continental National Bank, established in December 1930 through consolidation of Boston National Bank and Continental National Bank, became insolvent. December 17, 1931, a receiver appointed by the Comp-troller of the Currency took charge of its affairs. Petitioner is his successor. Among the bank’s effects were four “Note-Guaranty” Bonds—$40,000, $52,000, $20,000 and $20,000—alike in form, dated in August and December 1930 and June and July 1931, with certain “endorse-ments” showing extensions. Each purported to be exe-cuted by the maker of a described note as principal with Respondent as surety, and was conditioned to pay to the bank the amount of the note upon default, &c. In June and September 1932 the Receiver brought separate actions at law upon three of these bonds. In each he alleged that the Company was indebted to him for the specified penalty with interest; and for this he asked judgment. The three déclarations are alike in form and allégations. One, typical of ail, is copied below.1 1 Déclaration— Now cornes the plaintiff in the above-entitled action and says that on December 22, 1931, he was appointed receiver of Boston-Continental National Bank by the Comptroller of the Currency of the United States, that he duly qualified and is now acting as such receiver. And the plaintiff says that the défendant duly entered into, exe-cuted under seal and delivered to the Continental National Bank of DEITRICK v. STANDARD SURETY CO. 473 471 Opinion of the Court. There also is one of the Note-Guaranty Bonds, typical of ail.2 Each déclaration exhibited a bond, alleged that thereby the Company bound itself to pay the bank a Boston, now known as Boston-Continental National Bank, a written instrument or bond, copy whereof is hereto annexed marked “A” and hereby made a part hereof; that by the terms of said bond the de-fendant bound itself to pay said Continental National Bank of Boston the sum of forty thousand dollars ($40,000) in the event that four notes of ten thousand dollars ($10,000) each signed by Westchester Discount Corporation were not paid upon the due dates as set forth in said bond, the last due date being April 20, 1931; that some time prior to April 20, 1931, said bond was extended to June 20, 1931, by a written instrument called endorsement, copy whereof is hereto annexed marked “B”; that some time prior to June 20, 1931 said bond was extended to December 20, 1931 by a written instrument called endorsement, copy whereof is hereto annexed marked “C”; that the condition of said bond as extended as aforesaid has been broken in that Westchester Discount Corporation, the principal named therein, has not paid the notes described in said bond accord-ing to their terms, but on the contrary has failed, refused and declined to pay said notes and still continues so to refuse, notwithstanding the fact that ail times hâve elapsed and ail conditions hâve been fulfilled necessary to entitle the plaintiff to payment in full of said notes; that the défendant was duly notified of the default in accordance with the provisions of the bond; that the damages sustained by the plaintiff on account of the default of said Westchester Discount Corporation are in excess of forty thousand dollars ($40,000). Wherefore, the défendant is indebted to the plaintiff in the penal sum of said bond with interest from December 20, 1931. And the plaintiff says that this is an action at law arising under the Constitution and laws of the United States and is a case for winding up the affairs of said Boston-Continental National Bank; and the District Court of the United States for the District of Massachusetts has original jurisdiction under Section 24 of the Judicial Code of the United States. (Signed) By his Attorneys,------------, * Copy of Bond— No. $40,000.00 Know ail Men by these Présents, That we, Westchester Discount Corporation of Mount Vernon, New York, as Principal, and 474 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. specified sum in the event of default, which had occurred, &c., that damages had been sustained whereby the surety had become indebted “in the penal sum of said bond, with interest.” the Standard Surety & Casualty Company of New York, a corporation organized and existing under the laws of the State of New York and having an usual place of business in Boston, as Surety, are held and firmly bound and obliged unto the Continental National Bank of Boston, a banking corporation duly organized under the laws of the Commonwealth of Massachusetts and having an usual place of business in Boston in the County of Suffolk, in the full and just sum of forty thousand dollars ($40,000.), to be paid to said Continental National Bank of Boston as hereinafter provided to which payment we bind ourselves, our heirs, executors, adminis-trators firmly by these présents. The condition of this obligation is such that if the said Westchester Discount Corporation shall upon the due dates as hereinafter indi-cated make to the Continental National Bank of Boston full and true payment of a schedule of four notes as listed below then this obligation shall be void, otherwise shall remain in full force and effect. Schedule of Notes. Date Amount Maturity Dec. 20,1930.................... $10,000.00 January 20,1931 Dec. 20,1930...................... 10,000.00 February 20,1931 Dec. 20,1930...................... 10,000.00 March 20,1931 Dec. 20,1930...................... 10,000.00 April 20,1931 In the event of default on the part of the principal on any note, the obligée shall notify the Home Office of the Surety Company at 80 John Street, New York City, New York, within ten (10) days by registered mail, of such default, and the Surety Company shall pay any liability hereunder, not exceeding the amount still unpaid on any or ail of the aforesaid notes and in no event exceeding forty thousand dollars ($40,000.), said payment to be made by the Surety within thirty days after maturity of the final note. Witness our hands and seals, and dated this 20th day of Decem-ber, A. D. 1930. Westchester Discount Corporation [seal], By Joseph Stone, Treas. Standard Surety & Casualty Company of New York, By Percy G. Cliff, Attorney-in-fact. DEITRICK v. STANDARD SURETY CO. 475 471 Opinion of the Court. Answering, the Company denied liability and alleged that, as the bank well knew, the bond was executed without authority, had been fraudulently obtained, was in-valid. Before the three law actions were filed the Surety Company instituted four separate équitable proceedings in the Suprême Court, Suffolk County, Massachusetts, against the bank and makers of guaranteed notes. Each complaint alleged that the bank had fraudulently obtained the bond and asked that it be declared null and void. Later the Receiver became party in these causes and ail were removed to the fédéral court. There, he filed separate answers, substantially alike, averring that the bond had been duly executed, that default had taken place and that damages amounting to the full amount of the specified penalty had been sustained. Each answer concluded—“Wherefore these défendants pray: 1. That the court détermine the amount due from the plaintiff to Boston-Continental Bank and John B. Cunningham, its receiver, and order the plaintiff to pay the same with interest. 2. For such further relief as the court finds meet and just.” Copies of one complaint3 and answer4 thereto, typical of ail, are in the margin. 3 Bill of Complaint— 1. The plaintiff is a corporation legally established and existing under the laws of the State of New York, having a usual place of business in Boston in the County of Suffolk in this Commonwealth. 2. The défendant Boston-Continental National Bank formerly called Continental National Bank of Boston, is a national banking association, legally established and existing under the laws of the United States of America, having its usual place of business in said Boston. The défendant Westchester Discount Corporation is a corporation established and existing under the laws of the State of New York having its usual place of business in Mount Vemon in the County of Westchester and State of New York. 3. The plaintiff is informed and believes and therefore avers that on or about December 20th, A. D. 1930 the défendant Westchester 476 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. A jury was waived in the law actions and the seven causes went to an Auditor and Master with instructions Discount Corporation and one Percy G. Cliff executed an instrument a copy of which is hereto annexed marked A and made a part hereof, and at the same time the défendant bank executed and delivered to said Cliff an instrument entitled “Release” a copy of which is hereto annexed Marked B and made a part hereof. Thereafter, so the plaintiff is informed and believes and therefore avers, the said Cliff executed the instruments entitled “Endorsements” copies of which marked respectively C. and D. are hereto annexed and made parts hereof. 4. The plaintiff is informed and believes and therefore avers that ail of the instruments aforesaid marked A. C. and D. were executed by said Cliff at the request and solicitation of the défendants without any considération or security, without premium charged or paid or intended to be charged or paid therefor, upon the understanding between the défendants and said Cliff that said instruments were not binding obligations of the plaintiff, and upon the assurance and promise given by the défendants to said Cliff and upon the understanding that said instruments would not be used or enforced by said bank against the plaintiff, that the plaintiff should never be informed of the existence thereof, and that after remaining in the custody of the défendant bank for a short time they should be retumed to said Cliff. 5. Ail of the instruments above described copies of which are hereto annexed marked A. C. and D. were executed by the said Cliff without authority from the plaintiff and without its knowledge or consent, as both défendants well knew. The plaintiff has only re-cently leamed of the existence of said instruments which are now in the possession of the défendant bank. Wherefore the plaintiff prays: 1. That the défendants be enjoined from enforcing or attempting to enforce the said instruments marked A. C. and D. or any of them by suit or otherwise. 2. That the said instruments marked A. C. and D. be declared null and void and that the défendant bank be ordered to deliver them up to be cancelled. 3. For such other and further relief as may be necessary and proper. (Signed) By its Attorneys,------------, DEITRICK v. STANDARD SURETY CO. 477 471 Opinion of the Court. to report findings of fact and conclusions of law, the former to be final. After taking much evidence he reported with 4ANSWER OF BOSTON-CONTINENTAL NATIONAL BANK AND JOHN B. CUNNINGHAM, RECEIVER OF BOSTON-CONTINENTAL NATIONAL BANK. Now corne Boston Continental National Bank and John B. Cunningham, receiver of Boston-Continental National Bank, and for answer to the plaintiff’s bill of complaint say as follows: 1. They admit the allégations contained in the first paragraph of the bill of complaint. 2. They admit the allégations contained in the second paragraph of the bill of complaint. 3. As to the allégations contained in the third paragraph of the bill of complaint, they say that the instrument, a copy whereof is attached to the bill of complaint marked “A”, was duly executed by Westchester Discount Corporation by Joseph Stone, its treasurer, and was duly executed by the plaintiff, by Percy G. Cliff, its attor-ney-in-fact, and that an attested copy of said Cliff’s general power of attorney was attached to the original instrument; that thereafter the plaintiff duly executed the instruments entitled “Endorsements” by said Cliff, its attomey-in-fact, copies of which endorsements are attached to the bill of complaint marked “C” and “D”; that if a purported release was delivered to said Cliff by Continental National Bank by Terrell M. Ragan in the form attached to the bill of complaint marked “B”, such purported release was delivered without authority of the board of directors of said Continental National Bank, was executed without considération and is voidable and vpid. Except as aforesaid, they deny the allégations contained in said paragraph 3 of the bill of complaint. 4. They deny the allégations contained in the fourth paragraph of the bill of complaint. 5. They deny the allégations contained in the fifth paragraph of the bill of complaint. 6. Further answering they say that the condition of said instrument, copy of which is attached to the bill of complaint marked “A” as extended by instruments, copies of which are attached to the bill of complaint marked “C” and “D”, has been broken in that Westchester Discount Corporation, the principal named in said instrument, has not paid the notes described therein according to their terms, but on the contrary has failed, refused and declined to pay said notes and still continues so to refuse, notwithstanding the fact 478 OCTOBER TERM, 1937. Opinion of the‘Court, 303 U. S. a finding of facts showing clearly that the bank obtained the bonds through the fraud of its president, Ragan, and Cliff, general agent of the Company. Among other things he said: “I rule that the bonds and ‘endorsements’ in suit were not binding obligations in the hands of the bank as a going concern, for the reason that Ragan’s knowledge of their infirmities is imputed to the bank; and that the bonds and ‘endorsements’ would not be binding obligations in the hands of the receiver, if his rights were de-rived solely from the bank as distinguished from its cred-itors.” He further ruled that as Cliff, general agent of the Surety Company, knew the bonds would be shown to the bank directors and to any others entitled to inquire concerning the notes described therein for the purpose of déception, therefore “the bonds and ‘endorsements’ in suit are binding obligations in the hands of the receiver due to the fact that he represents the bank’s creditors.” The District Court heard the causes on report and exceptions. It held the bonds void and further “adjudged and decreed that the counterclaim of the défendant receiver, set forth in his answer, be and the same is hereby dismissed.” that ail times hâve elapsed and ail conditions hâve been fulfilled necessary to entitle Boston-Continental National Bank and John B. Cunningham, receiver of said bank, the successors to the obligée described therein, to payment in full of said notes; that the plaintiff was duly notified of the default in accordance with the provisions of the said instrument; that the damages sustained by these défendants on account of the default of said Westchester Discount Corporation are in excess of $40,000. Wherefore these défendants pray: 1. That the court détermine the amount due from the plaintiff to Boston-Continental National Bank and John B. Cunningham, its receiver, and order the plaintiff to pay the same with interest. 2. For such further relief as the court finds meet and just. (Signed) By their Attorneys,-----------, DEITRICK v. STANDARD SURETY CO. 479 471 Opinion of the Court. By stipulation the causes were joined for appeal upon a single record. The Circuit Court of Appeals affirmed the District Court and said: “The master and auditor held that the receiver in bringing these actions did not dérivé his right of recovery through the Bank, but because one or more creditors of the Bank were deceived, and as he represents creditors he derived his right of action through them. The receiver, however, makes no such allégations in his déclaration.” “It is clear from the plead-ings that the receiver seeks to recover on these bonds as assets of the Bank. In such an action he stands no better than the Bank itself. Ail defenses open against the Bank in such a case are open against the receiver, and he is chargeable with knowledge of ail facts known to the bank affecting the character of the claim.” “If therefore, the contract with the Surety Company was illégal as to the Bank, because, as the master and auditor found, the Bank was charged with the knowledge of its president, a recovery based on the contract of surety cannot be had by the receiver, since a recovery must be based on the pleadings, and the allégations of liability in the plaintiff’s déclarations are based solely on the contract of surety.” In respect of the Receiver’s counterclaim set up in the equity suits it said: “The plaintiff’s counterclaim distinctly raises the question of the validity of the bonds. The issue of trust for the benefit of creditors is not raised or sug-gested.” “The obligations of the Surety Company based on the depositors of the bank being injured by the giving of the bonds, and the receiver’s claim against the Surety Company based on a trust relationship are not mentioned, and, we think, are not raised by the plaintiff’s counterclaim in the equity suits.” We agréé with the conclusion reached by the Circuit Court of Appeals. Its judgment must be affirmed. Counsel for the Petitioner here submit—“The Receiver’s position rests primarily upon the proposition that the 480 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. circumstances surrounding the giving of the note-guar-anty bonds by Cliff to the Bank accompanied by the supporting powers of attorney, . . . and the conséquences which foliowed the credence given to said bonds and powers of attorney by the national bank examiners and the Comptroller, acting as the représentatives of the depositors and other creditors, give rise, in a suit by the Receiver to enforce the bonds, to an estoppel which pre-cludes the Surety Company from denying the validity of the bonds and from asserting as a defense that its agent acted fraudulently and without authority in executing the bonds and that a fraudulent official of the Bank knew of the agent’s misconduct.” An examination of the pleadings inakes it quite clear that the Receiver undertook to set up rights acquired by the insolvent bank through duly executed contracts between it and the Surety Company. He makes no suggestion of a purpose attributable to the company to mislead creditors or others; makes no allégations of damage except that sustained by the bank. He sets up no facts which would render unconscionable a déniai of liability upon the bond because of the agent’s fraud obviously in-duced by the president of the bank. In this state of the pleadings the Receiver may not hâve judgment; he can-not rely on something not complained of, nor can he hâve damages because of supposed déceptions which the pleadings fail to suggest. In Rankin v. City National Bank, 208 U. S. 541, 545, 546, a suit by the receiver of the Capitol National Bank of Guthrie to recover the amount of an alleged deposit where it appeared “that the whole business, from begin-ning to end, was and was intended to be a mere juggle with books and papers to deceive the bank examiner,” this Court denied the receiver’s claim and said: “If the Guthrie Bank had sued while it was a going concern it could not hâve recovered, and the receiver stands no bet- DEITRICK v. STANDARD SURETY CO. 481 471 Black, J., dissenting. ter than the bank.” We adhéré to the doctrine there approved and regard it as décisive of the présent cause. Affirmed. Mr. Justice Cardozo took no part in the considération or decision of this case. Mr. Justice Black, dissenting. When two or more persons hâve jointly perpetrated a fraud with intent to injure others, justice and law combine to entitle injured parties to recover from any or ail of the conspirators. Corporations can act only through agents. When, as here, two corporations, acting through authorized agents, hâve jointly perpetrated a fraud which was intended to—and did—injure others, a just rule of law should likewise hold both corporations jointly and severally responsible for the damages inflicted by them upon innocent parties. In this case innocent depositors and other creditors of a now insolvent national bank suffered damages as a direct resuit of fraud wilfully perpetrated on them by joint action of the bank and the respondent surety corporation, acting through their agents. Because of the guilty participation of the bank president in this fraud, the opinion just read déniés the receiver of the insolvent bank a recovery which would inure to the benefit of the innocent depositors. At the same time, however, the respondent surety corporation is freed from any respon-sibility to these innocent parties, in spite of the admitted guilty participation of its agent. That the agent of the respondent surety corporation was authorized to write the indemnity bonds used in the fraud is disclosed by the findings of the master and auditor—acting “under a stipulation that findings of fact shall be final.” These findings show that: The duly licensed agent of the surety company (respondent) conspired with the president of the bank to 53383°—38-------31 482 OCTOBER TERM, 1937. Black, J., dissenting. 303 U. S. supply indemnity bonds guaranteeing the payment of certain notes held by the bank, which bonds were to be placed among the assets of the bank for the purpose of deceiving fédéral bank examiners, the bank’s directors and ail others entitled to inquire as to the soundness of the notes; the surety company’s agent also personally as-sured the examiners that the bonds were ail right; no premium was paid the surety company and the bonds were intended by the respondent’s duly authorized agent and the president of the bank to be valueless and used as “window dressings” to accomplish déceptions; respondent’s duly licensed agent had a power of attorney “to make, execute and deliver . . . for and on its behalf as surety, any and ail bonds . . . undertakings, or any-thing in the nature of any of them, . . . to ail intents and purposes as if same had been duly executed and ac-knowledged by the regularly elected officers of the company . . . a copy of the power of attorney was attached to the bonds and the examiners inspected public records and verified the authenticity of this power of attorney; these bonds were executed after the examiners had notified the bank to make good an impairment of capital and the execution of these bonds caused the comp-troller to withdraw his order to make good the impairment and as a resuit the bank continued to remain open, assumed additional obligations, and accepted further de-posits in large amounts. Since the receiver represents the creditors as well as the bank1 he can sue in his own name to recover assets 1 Case v. Terrell, 11 Wall. 199, 202; High, “On Receivers,” 4th ed., §§ 314, 320; In re Pleasant Hill Lumber Co., 126 La. 743, 757; 52 So. 1010; Duke v. Stayton Co., 132 Wash. 69, 77; 231 Pac. 171; Atlantic Trust Co. v. Dana, 128 Fed. 209, 221 ; De Stafano v. Almond Co., 107 N. J. Eq. 156, 159; 152 Atl. 2; Industrial Mut. Dep. Co.’s Receiver v. Taylor, 118 Ky. 851, 854; 82 S. W. 574; Iglehart v. Todd, 203 Ind. 427, 440; 178 N. E. 685. DEITRICK v. STANDARD SURETY CO. 483 471 Black, J., dissenting. on behalf of the bank or its creditors.3 “It is the duty of the receiver of an insolvent corporation to take steps to set aside transactions which fraudulently or illegally reduce the assets available for the general creditors, even though the corporation itself was not in a position to do so.” Texas & Pacific Ry. Co. n. Pottorfj, 291 U. S. 245, 261. There is no occasion to consider whether the bank could recover against the insurance company on the indemnity bonds. “Enough that the receiver has the requisite capacity.” McCandless n. Furlaud, 296 U. S. 140, 160. In the McCandless case (page 171), the minor-ity view was that “the receiver’s rights could rise no higher” than the corporation’s rights. The majority re-jected this viewpoint (page 159), holding that where corporate officers and shareholders combined with others to despoil a corporation, recovery could be had “either by the creditors directly or in their behalf by a receiver.” The receiver does not merely represent the corporation—the bank. The object of the appointment of a receiver is to collect and protect ail of the insolvent’s assets in the interest of the creditors first, then for the benefit of the stockholders. It has long been recognized that even in the case of a going bank the rights of depositors and the public would be jeopardized unless given protection in addition to that afforded by the bank’s officers elected by the stockholders. For that reason, among others, the Government has provided a System of examination for ail national banks.3 Statutes require banks to make reports to the Comptroller of the Currency and to permit examinations by fédéral bank examiners. These examinations are designed to prevent such frauds as were perpe-trated in this case. This objective will be frustrated if surety companies—with complété immunity—can, through their authorized agents, conspire with bank offi- a See, Kennedy v. Gibson, 8 Wall. 498, 506. 3 See, Easton v. loua, 188 U. S. 220, 238. 484 OCTOBER TERM, 1937. Black, J., dissenting. 303 U. S. cials to deceive and trick bank examiners. The con-venient fiction that knowledge of an officer of the bank is imputed to the bank itself is not sufficient to relieve respondent surety company from the conséquences of the wrong committed by its authorized agent. There is not even a fiction under which knowledge can be imputed to innocent depositors. Strange, indeed, it is if the elab-orate System of précautions provided by the Government to protect the interests of creditors of national banks by examination and visitation of fédéral officiais must be held for naught by application of the fiction that the bank—not the injured depositors—knew everything its president knew. The interests of the bank and the interests of the depositors and creditors are not always iden-tical. That their interests are recognized as separate and distinguishable is amply shown by laws passed to protect depositors and creditors of national banks. Public solicitude for protection of depositors is exemplified by the recent passage of the law insuring public deposits.4 The receiver filed suits at law side to recover on the several indemnity bonds. The surety company proceeded in equity praying cancellation of the bonds.. AU actions were tried on evidence before a master and auditor “under a stipulation that findings of fact shall be final.” These findings set forth ail of the rights of the receiver as the représentative of the creditors, the stockholders and the bank. In this case, the principles involved are of great importance. The decree below adjudged the indemnity bonds to be void and unenforceable. Since I believe the receiver was entitled under these actions to enforce the bonds and to protect the innocent victims of fraud, I would reverse the decree below. Mr. Justice Reed concurs in this opinion. 412 U. S. C. § 264 et seq. STATE FARM INS. CO. v. COUGHRAN. 485 Syllabus. STATE FARM MUTUAL AUTOMOBILE INS. CO. v. COUGHRAN. CERTIORARI TO THE CIRCUIT COURT OF APPEALS FOR THE NINTH CIRCUIT. No. 519. Argued March 4, 1938.—Decided March 28, 1938. 1. Upon appeal in a law case tried without a jury, the Circuit Court of Appeals détermines whether the findings support the judgment, but can not review the evidence. P. 487. 2. An automobile insurance policy provided that the insurance company should not be liable unless the car at the time of accident was being “operated” by the insured, his paid driver, members of his immédiate family, or persons acting under his direction, nor if it was being “driven or operated” by any person violating any law as to âge or driving license. There was a finding that the accident in question occurred while the car was being operated, with the permission of assured, by his wife, and was caused by her négligence. There was another finding that it occurred while it was being jointly operated by the wife and, with her permission but contrary to the orders of the husband, by a 13 year old girl, unlicensed and unlicensable under the law of California, who at the time of the accident was physically actuating instrumentalities of the automobile other than the means of direction; and that the proximate cause of the collision was the act of the wife in seizing the steering wheel at and immediately preceding the moment of impact. Held: (1) That the findings are not in conflict; the first refers to the conduct of the wife as the one in authority; the second details what really took place at moment of collision. P. 491. One may “operate” an automobile singly or jointly with another. (2) The risk was not within the policy. P. 487. 3. A person injured by an automobile in charge of the assured’s wife, recovered judgment against both of them in an action defended by the husband’s insurer under a non-waiver agreement; and, failing to collect it, sued the insurer. Held that proof that the machine, at the time of the accident, was being operated by the wife and a child, jointly, contrary to the husband’s orders and contrary to law, was available as a defense under the policy, not-withstanding the insurer’s failure to disclose it at the other trial. P. 492. 92 F. 2d 239, reversed. 486 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. Certiorari, 302 U. S. 679, to review the affirmance of a judgment recovered in an action on a policy of insurance. Mr. Joseph A. Spray, with whom Mr. Sydney L. Gra-ham was on the brief, for petitioner. Mr. Raymond G. Stanbury, with whom Mr. John F. Gilbert was on the brief, for respondent. Mr. Justice McReynolds delivered the opinion of the Court. Petitioner’s policy insured one R. O. Anthony, the owner, against liability for injuries caused by a designated automobile. As the resuit of alleged négligent and unlaw-ful action by the assured’s wife the car collided with a truck June 16, 1934. Respondent Coughran suffered injuries for which he recovered judgment against Anthony, also against his wife. Both were insolvent ; a writ of execution against them was returned unsatisfied. Thereupon respondent commenced this suit to recover of petitioner the amount of his unpaid judgment. He claimed this right under the policy and statute. An-swering, the company exhibited the policy and denied liability. As a first separate defense it alleged that Anthony and his wife had not complied with certain terms of the contract. As a second— “That said accident was an accident for which the de-fendant under the terms and conditions of said policy is not liable in that : At the time and place of the accident the automobile of the insured was being driven and oper-ated by a person who was not the paid driver of the insured, nor a member of his immédiate family, nor a person acting under the direction of the assured. This défendant allégés that the said automobile at the time of the accident was being driven and operated by a person in violation of the laws of the State of California as to âge and as to driver’s license and further allégés STATE FARM INS. CO. v. COUGHRAN. 487 485 Opinion of the Court. that the driver of said car was a minor, being a female of the âge of approximately 13 years.” There were other separate defenses. A jury having been waived, the cause went to the court on the pleadings and evidence. It made findings of fact with conclusion of law and entered judgment for Coughran. Neither side requested other or different findings. The Circuit Court of Appeals thought findings III and XII were inconsistent “and to elucidate the truth, a review of the testimony is required.” After such review it ruled that the findings so elucidated were adéquate and required affirmation of the challenged judgment. One judge thought otherwise and presented a separate opinion. Under applicable statutes and repeated rulings here, the matter open for considération upon the appeal was whether the findings of the trial court supported its judgment. To review the evidence was beyond the compe-tency of the court. U. S. C. Title 28, §§ 773, 875; Wal-nut v. Wade, 103 U. S. 683, 688; Stanley v. Supervisors of Albany, 121 U. S. 535, 547 ; Law v. United States, 266 U. S. 494, 496. Two persons were in the insured automobile when the accident occurred. Nancy Leidendeker, a girl of 13 without license to drive, occupied the driver’s seat. By her side sat Helen B. Anthony, wife of the assured, an adult holding a driver’s license. The principal point upon which the petitioner now relies is that as the accident occurred when the car was being driven and operated by the young girl contrary to the owner’s commands and in violation of California statutes, the policy did not cover his liability. The policy (incorporated in the findings) under the heading “Terms and Conditions Forming a Part of This Policy,” provides— “(1) Risks Not Assumed by This Company. The Company shall not be liable and no liability or obligation 488 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. of any kind shall attach to the Company for losses or damage: ...(A)...(D) Unless the said automobile is being operated by the Assured, his paid driver, members of his immédiate family, or persons acting under the direction of the Assured; (E) Caused while the said automobile is being driven or operated by any person whatsoever either under the influence of liquor or drugs or violating any law or ordinance as to âge or driving license; (F) . . .” Applicable sections of the California Vehicle Act,— Stats. 1923, pp. 518, 519, 536; Stats. 1927, p. 1427; Stats. 1931, p. 2108—follow: “Section 1, The foliowing words and phrases used in this act shall hâve the meanings here ascribed to them.” “Sec. 18. ‘Operator’ Every person who drives, opérâtes or is in actual physical control of a motor vehicle upon a public highway.” “Sec. 76. Unlawful to employ unlicensed chauffeur. No person shall employ for hire as a chauffeur of a motor vehicle, any person not licensed as in this act provided. No person shall authorize or knowingly permit a motor Vehicle owned by him or under his control, to be driven by any person who has no legal right to do so or in violation of the provisions of this act.” “Sec. 58. Operators and chauffeurs must be licensed. “(a) It shall be unlawful for any person to drive a motor vehicle upon any public highway in this state, whether as an operator or a chauffeur, unless such person has been licensed as an operator or chauffeur; except such persons as are expressly exempted under this act.” [Exception not applicable here.] “Sec. 64. What persons shall not be licensed as operators or chauffeurs. “(a) An operator’s license shall not be issued to any person under the âge of sixteen years and no chauffeur’s license shall be issued to any person under the âge of STATE FARM INS. CO. v. COUGHRAN. 489 485 Opinion of the Court! eighteen years, provided that an operator’s license may be issued to any minor over the âge of fourteen years and less than sixteen years of âge upon spécial application and statement of reasons by the parent or guardian of such minor.” Especially pertinent findings by the trial court follow: “III. The. court finds that on or about the 16th day of June, 1934, and while said policy was in full force and effect, one Helen B. Anthony operated the Chevrolet automobile referred to in and covered by the said policy of insurance with the permission and consent of the assured, R. O. Anthony, and operated the same negligently so as proximately to cause an accident and in jury to the person and property of the plaintiff to his damage in the reasonable sum of Five Thousand Ninety-two and 55/100 Dollars ($5092.55).” “IX. The court finds that it is true that the défendant, prior to the trial of the action in the state court entered into the non-waiver agreement received in evidence in this action with the assured, R. O. Anthony, and with Helen B. Anthony. That the said non-waiver agreement was executed just prior to the commencement of the trial of the state court action. That the plaintiff was not a party to that agreement and had no knowledge of any facts referred to therein and was not in privity with any of the défendants in the state court action and that so far as the conduct of the défendant affects the plaintiff in this action, the défendant managed and conducted the defense in the state court.” “XII. With regard to the second separate defense of défendant, the court finds that the said automobile at the time of the impact that resulted in the injury to the plaintiff was being jointly operated by Helen B. Anthony and Nancy Leidendeker; that said Helen B. Anthony was a member of the assured’s immédiate family and was an adult person over the âge of twenty-one (21) years 490 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. who was licensed by the State of California to drive an automobile; and that said Nancy Leidendeker was a minor and not permitted under the applicable laws to operate a motor vehicle in the State of California; that the assured had forbidden said minor Nancy Leidendeker to drive any motor vehicle or automobile of which he was the owner or which he controlled ; and that the action of said Nancy Leidendeker on the day of the accident and at the time of the impact involved in this action were in disobedience of and contrary to the commands, orders and instructions of the assured, R. O. Anthony; that at the time of the accident, insofar as the propulsion of the vehicle was concerned, other than the means of direction, ail instrumentalities of said automobile were being physi-cally actuated by said minor Nancy Leidendeker, with the acquiescence and knowledge of Helen B. Anthony and without any knowledge, acquiescence or consent on the part of the assured, R. O. Anthony; that the proximate and direct cause of the collision between the insured automobile and a truck owned by San Pedro Commercial Company was the act of Helen B. Anthony in seizing the steering wheel of the automobile at and immediately pre-ceding the moment of impact and collision.” “XVI. That prior to the commencement of the trial of the said State court action the défendant had full knowledge of ail the facts and circumstances concerning the presence of the said Nancy Leidendeker in the driver’s seat or in a part of said seat, and ail other facts relied on by the défendant as constituting a concealment and a defense of the case at bar, but that the défendant did not reveal said facts to the plaintiff or his counsel, and that plaintiff and his counsel had no knowledge that the said Nancy Leidendeker occupied any part of the driver’s seat until said trial was completed.” “XVII. The court finds that prior to the collision between the insured automobile and a truck owned by the STATE FARM INS. CO. v. COUGHRAN. 491 485 Opinion of the Court. San Pedro Commercial Company, Helen B. Anthony seized the steering wheel of the insured automobile and steered the same to the right, proximately causing the same to corne into collision with the said truck and proximately causing the same to turn to its right, proximately causing the collision of plaintiff’s car and the injuries and damages suffered by him.” When read together no material conflict exists between findings III and XII ; there is no real difficulty in under-standing the circumstances to which they are addressed. The first contains statements concerning the conduct of one in authority; the second describes in detail what really took place at the moment of collision. The word “oper-ate” has varying meanings according to the context. Web-ster’s New International Dictionary. One may operate singly with his own hands, or jointly with another, or through one or more agents. From the findings it appears that when the accident occurred the automobile was not being operated by the assured, his paid driver, a member of his immédiate family or a person acting under his direction, within fair intend-ment of the policy. Contrary to the owner’s commands “insofar as the propulsion of the vehicle was concerned, other than the means of direction, ail instrumentalities of said automobile were being physically actuated by said minor” who was inhibited by the statutes from driving or operating a motor vehicle within the State. Just before the accident, Mrs. Anthony seized the steering wheel and by négligent manipulation of this caused the collision. If, as found, the automobile was being jointly operated by the wife and the girl the risk was not within the policy. The latter was forbidden by law to operate or drive jointly or singly. If the wife was in control the statute forbade her to permit driving by the girl. In any view, when the 492 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. collision occurred the car was being driven or operated in violation of the statutes. In support of his position respondent relies heavily upon O’Connell v. N. J. Fidelity Ins. Co., 201 App. Div. (N. Y.) 117; 193 N. Y. S. 911; and Williams v. Nelson, 228 Mass. 191; 117 N. E. 189. These causes, we think, are not in point. They were decided upon facts and cir-cumstances materially different from those here disclosed. Respondent further submits that petitioner is precluded from any inquiry concerning who actually was driving the car when the accident occurred. He says the entire sequence of events surrounding Nancy Leidendeker was highly material and should hâve been litigated in the original tort action brought by Coughran against the An-thonys, and based solely upon permissive use. Also, if the facts then known by petitioner had been there re-vealed, it would hâve become apparent that the girl lacked permission to drive and that the wife exceeded the terms of her authorization; and that by suppressing these facts petitioner exposed the assured to a liability which otherwise might not hâve been imposed. The judgment roll of the tort action is not before us; we are limited to the findings. That action was defended by the petitioner under a non-waiver agreement; the complaint alleged damages from négligence of the wife as driver and operator imputed to the husband. Défenses now presented by the Insurance Company against liability under the policy were not involved. Joint driving by Mrs. Anthony and the girl was not subject to inquiry. Moreover, in the circumstances we may not conclude that respondent should prevail because petitioner failed to présent facts in the tort action which he says if then presented might hâve defeated the very judgment upon which he now relies to support his claim. GUARANTY TRUST CO. v. COMM’R. 493 485 Syllabus. The judgment of the Circuit Court of Appeals must be reversed. The cause will be remanded to the District Court with instructions to enter judgment for the Insurance Company, petitioner here. Reversed. Mr. Justice Cardozo took no part in the considération or decision of this case. GUARANTY TRUST CO., EXECUTOR, v. COMMISSIONER OF INTERNAL REVENUE. CERTIORARI TO THE CIRCUIT COURT OF APPEALS FOR THE SECOND CIRCUIT. No. 301. Argued January 12, 13, 1938.—Decided March 28, 1938. A partnership whose fiscal year expired July 31, 1933, was dissolved by the death of a member in December, 1933. Decedent had kept his books on the cash receipts and disbursements basis and filed his retums for income tax for each calendar year on that basis. The partnership kept its books on a like basis, but made its returns for a fiscal year ending July 31. Upon a partnership accounting, his share of the profits from August 1 to date of his death was ascer-tained, and in the foliowing January and February was paid to the executor. Held, that the decedent’s taxable income for the calendar year 1933 includes his share of partnership profits from the beginning of the partnership fiscal year on Aug. 1, 1933, to the date of his death in the same year, in addition to his share of the partnership profits for its fiscal year ending July 31. Rev. Act 1932, § 182 (a). P. 495. 89 F. 2d 692, affirmed. Certiorari, 302 U. S. 670, to review a judgment of the court below reversing an order of the Board of Tax Appeals. The Board’s order, 34 B. T. A. 384, set aside a deficiency assessment. 494 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. Mr. Montgomery B. Angell, with whom Messrs. John W. Davis and Weston Vernon, Jr. were on the brief, for petitioner. Mr. Edward J. Ennis, with whom Solicitor General Reed, Assistant Attorney General Morris, and Messrs. Sewall Key and A. F. Prescott were on the brief, for respondent. Mr. Justice Stone delivered the opinion of the Court. Whether a deceased partner’s taxable income for the calendar year 1933 includes his share of partnership profits from the beginning of the partnership fiscal year on August 1, 1933, to the date of his death in the same year, in addition to his share of the partnership profits for its fiscal year ending July 31, is the question for decision. Petitioner’s testator, who died December 16, 1933, was a member of a New York partnership whose fiscal year expired on July 31, 1933. The partnership, with the addition of a new partner, was renewed, by agreement, for one year from August 1. After his death the surviving partners, by a further agreement, continued the partnership business from that date until July 31 of the next year, as of which date profits were to be determined, and there-after from year to year. Decedent kept his books on the cash receipts and disbursements basis and filed his re-turns for income tax for each calendar year on that basis. The partnership kept its books on a like basis, but made its returns for a fiscal year ending July 31. Upon a partnership accounting as of the date of de-cedent’s death, his share of the profits from August 1 to that date was ascertained and in the following January and February was paid to petitioner, as executor. In making return for taxation of decedent’s income for 1933, petitioner included decedent’s share of the firm profits accruing for the year ending July 31, but omitted to re- GUARANTY TRUST CO. v. COMM’R. 495 493 Opinion of the Court. ' turn his share of the firm profits earned between that time and his death. The Commissioner’s détermination of a deficiency based on the omitted income, was set aside by the Board of Tax Appeals. 34 B. T. A. 384. The Board’s order was reversed by the Court of Appeals for the Second Circuit, which held that decedent’s share of the partner-ship profits for the year ending July 31 and for the ensu-ing period ending December 16, 1933, was income of decedent in 1933 and taxable as such for that year. 89 F. (2d) 692. We granted certiorari, the question being of importance in the administration of the revenue laws, and the decision being challenged by petitioner as not in harmony with Burnet v. Sanjord & Brooks Co., 282 U. S. 359. Both by the practical construction given to the partner-ship agreement by petitioner and the surviving partners, and by the applicable provisions of the New York Part-nership Act,1 decedent’s death dissolved the partnership, terminated his right to share in the profits, and fixed the date as of which the surviving partners were bound to JNew York Partnership Act, Laws of 1919, c. 408: “Sec. 60. Dissolution defined.—The dissolution of a partnership is the change in the relation of the partners caused by any partner ceasing to be associated in the carrying on as distinguished from the winding up of the business. “Sec. 61. Partnership not terminated by dissolution.—On dissolution the partnership is not terminated, but continues until the winding up of partnership affairs is completed. “Sec. 62. Causes of dissolution.—Dissolution is caused: “4. By the death cf any partner; “Sec. 74. Accrual of actions.—The right to an account of his interest shall accrue to any partner, or his legal représentative, as against the winding up partners or the surviving partners or the person or partnership continuing the business, at the date of dissolution, in the absence of agreement to the contrary.” 496 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. account for the profits. Darcy v. Commissioner, 66 F. (2d) 581. Decedent’s estate in fact received the profits accrued on the date of his death, and partnership profits thus accrued and distributable by reason of the death of a partner are his income, taxable as such. Bull v. United States, 295 U. S. 247. But petitioner insists that here they cannot be included in decedent’s 1933 income for purposes of taxation, since in that case his partnership profits both for the full year ending July 31, 1933 and for the ensuing four and one-half months’ period ending with his death in December, would be taxed as his profits for a single year. This it is said offends against the policy of the revenue acts to assess income taxes annually on the basis of twelve month periods and, so offending, conflicts with the appropriate construction of the applicable provisions of §§ 181, 182 of the Revenue Act of 1932, 47 Stat. 169, relating to the taxation of partnership profits. Under the Act of 1932, as with earlier revenue acts, partnerships are not taxed upon their income. By § 189 they are required to file information returns showing the partnership profits and the respective shares of the partners in the profits. But § 181 provides that the partners shall be “liable for income tax only in their individual capacity,” and § 182 (a) reads: “General rule.—There shall be included in computing the net income of each partner his distributive share, whether distributed or not, of the net income of the partnership for the taxable year. If the taxable year of a partner is different from that of the partnership, the amount so included shall be based upon the income of the partnership for any taxable year of the partnership ending within his taxable year.” Since the partnership is not a taxpayer, it has no taxable year in a literal sense. But as used in this section “taxable year of the partnership” means its fiscal year, for “taxable year” is defined by § 48 as including in its meaning GUARANTY TRUST CO. v. COMM’R. 497 493 Opinion of the Court. “a fiscal year . . . upon the basis of which the net in-oome is computed” and “fiscal year” is defined as “an accounting period of twelve months ending on the last day of any month other than December.” A “taxable year,” it is declared, includes the period for which a return is made when, under the provisions of the act or régulations, a return for a fractional part of a year is required. As a partner’s profits are ascertainable only on an accounting for such periods as may be fixed by law or by the partner-ship itself, and as the fiscal year or accounting period of the partnership may differ from that of the taxable year of the partner, § 182 (a), as a matter of convenience to taxpayers, authorizes and provides for this différence by requiring in that case that the partner’s distributive share of the profits ascertained at the end of the partnership fiscal year shall be included in his taxable income for the year in which the fiscal year of the partnership ends. Petitioner does not complain of the taxation of de-cedent’s share of the partnership profits for the year ending July 31 as 1933 income. But it contends that the reference in § 182 (a) to the “taxable year of the partnership,” and the requirement that the amount of the partner’s taxable income “shall be based upon the income of the partnership for any taxable year of the partnership ending within his taxable year,” read in their context and in the light of the practice long established by the revenue acts, of taxing income for twelve month periods, contem-plate that a partner returning income for a calendar year shall be taxable in that year only upon his income from his firm for a single partnership year. This is said to be the case even though the income de-rived by a partner from the firm business between the end of the partnership fiscal year and the date of his death in the same year cannot be taxed in any other. This argument is, we think, based upon a misconcep-tion of the policy of the Act and a mistaken construction 53383°—38-------32 498 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. of § 182 (a). It is true that the acts of Congress taxing income-have consistently laid the tax upon the net income received by or accrued to the taxpayer in a “taxable year,” which is either the calendar year or a different fiscal year, as the taxpayer may elect. But they hâve never undertaken to limit the income taxable in any one year to that derived from the taxpayer’s activities occurring in that or any other single year. The items of gross income and of allowed déductions to be included in the income return, are those of the taxpayer for his taxable year, even though they may hâve resulted from. or be affected by his business transactions of other years. Bur-net v. Sanford & Brooks Co., supra, 364, 365. Circum-stances wholly fortuitous may détermine the year in which income, whenever earned, is taxable, and may thus affect the amount of tax. Receipt of income or accrual of the right to receive it within the tax year is the test of taxability, not the time it has taken the taxpayer to earn it nor the duration of his investments which hâve finally resulted in profit. Lucas n. Alexander, 279 U. S. 573. The revenue acts hâve consistently adhered to that policy in taxing the income of a partner. Since the partner is entitled to profits only upon a partnership account-ing at the end of an accounting period, his profits become subject to income tax when and as they are thus ascer-tained. As in the case of ail other taxpayers, the part-ner’s net income is required by the general provisions of § 41 to be computed “on the basis of the taxpayer’s an-nual accounting period,” here the calendar year, so as clearly to reflect the income. And § 182 (a) commands that the distributive share of each partner in the partnership profits shall be included in computing his tax, whether distributed or not. By these provisions the taxable income of a partner is limited to that share of the partnership earnings to GUARANTY TRUST CO. v. COMM’R. 499 493 Opinion of the Court. which he becomes entitled within his taxable year, but it includes ail the distributive share of the partnership income which accrues to him in that year even though earned in an accounting period not wholly within the year, and though his return, as in the case of decedent, is on the cash receipts and disbursements basis. If the provisions stood alone it would seem plain that the profits accruing to decedent from the two partnership account-ings within his taxable year would be taxable in that year, even though the accounting periods aggregated more than twelve months. We think the concluding sentence of § 182 (a), which provides for the case where the partner’s taxable year differs from that of the partnership, does not call for any different resuit. We need not inquire too meticulously whether the partnership “taxable year,” within the meaning of § 182 (a), includes in the spécial circumstances of this case an accounting period of less than twelve months, here from July 31 to the death of decedent. Petitioner makes no contention that it does not, nor could weil do so, for if not so included it is not within the phrase “any taxable year of the partnership,” occurring in the second sentence of § 182 (a), on which petitioner relies to ex-clude the income for that period from taxation otherwise imposed by the general provisions of .§ 41 and the first sentence of § 182 (a). The argument is that the year ending July 31, 1933, was one partnership fiscal year or accounting period, and that the ensuing period until the death of decedent was another, and that the inclusion of the income for both periods in decedent’s taxable income is precluded by the use of the phrase “any taxable year” in § 182 (a), which it is said must be taken to mean any one accounting period of the partnership. But we think the sentence must be read as supple-menting the preceding one and § 41, and not as limiting them. We can discem elsewhere in the Act no indication 500 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. of any Congressional purpose to relieve business income from taxation in the year when, under the applicable provisions of the statute, it is distributable to a partner. Sections 11 and 12 déclaré in all-inclusive terms that income taxes “shall be levied, collected, and paid for each taxable year upon the net income of every individual.” It would require more précisé words than those of § 182 (a) directing that the taxable income of a partner shall be based on partnership income for “any” accounting period of the partnership ending within its taxable year, to restrict the broad sweep of §§ 11, 12 and 41. Cf. Heiner v. Colonial Trust Co., 275 U. S. 232, 234, 235; Helvering v. Stockholms Enskilda Bank, 293 U. S. 84, 89 ; United States v. Safety Car Heating & Lighting Co., 297 U. S. 88, 93; Helvering v. Gowran, 302 U. S. 238, 243, 244. The purpose of § 182 (a) when read, as it must be, with these other sections, is obviously not to relieve a partner from taxation of any part of the distributive share of the partnership income during the year in which it is distributable. The object is rather to make certain that “the amount so included” in a partner’s taxable income “shall be based upon the income of the partnership” distributable during the partner’s taxable year, even though an accounting period of the partnership ending in that year may not be wholly within it. This conclusion is supported by the legislative history of the second sentence of § 182 (a). The provision first appeared in § 218 (a) of the Revenue Act of 1918. As originally introduced, that section of the House bill which became the Revenue Act of 1918 provided for the taxation of the partner’s distributive share of the net income of the partnership for “the last annual accounting period of the partnership,” ending within his taxable year. By amendment the quoted phrase was stricken from the bill and the words “any accounting period of UNITED STATES v. O’DONNELL. 501 493 Syllabus. the partnership” substituted. See H. R. 12863, 65th Cong., 3rd Sess. (Committee Print—As Agreed to in Conférence). The amendment was obviously inconsistent with any purpose to limit the amount of the taxable income to that of any single or particular accounting period of the partnership ending within the partner’s taxable year. The phrase was changed by § 182 (a) of the Revenue Act of 1928 to its présent form, “any taxable year of the partnership.” The continued use of the word “any” as qualifying the phrase “taxable year” in the 1928 and 1932 Acts, does not preclude the présent tax if “taxable year” be taken to mean a partnership accounting period of less than twelve months. Reâsons hâve already been given why, if it means an accounting period of a full year, the présent tax is nevertheless due under § 41 and the first sentence of § 182 (a). Affirmed. Mr. Justice McReynolds and Mr. Justice Roberts are of opinion that the judgment should be reversed. Mr. Justice Cardozo and Mr. Justice Reed took no part in the considération or decision of this case. UNITED STATES v. O’DONNELL et al. CERTIORARI TO THE CIRCUIT COURT OF APPEALS FOR THE NINTH CIRCUIT. No. 487. Argued March 1, 2, 1938.—Decided March 28, 1938. In a suit to quiet its title to a part of Mare Island in San Francisco Bay, within the territory acquired from Mexico by the Treaty of Guadalupe Hidalgo, the United States claimed under a deed to it in 1853 by Bissell and Aspinwall, who derived their title through a grant in 1841 by Alvarado, Mexican Governor of California, to Castro. Respondents claimed under a patent issued by California to Darlington in 1857, purporting to convey the land in question as a part of the swamp or overflowed lands granted to the State 502 OCTOBER TERM, 1937. Syllabus. 303 U. S. by the Swamp Lands Act of 1850. The Board of Land Commis-sioners, created by the Mexican Claims Act of 1851, had confirmed the title of Bissell and Aspinwall in 1855. On appeal, the District Court had affirmed in 1857, although its decree was unsigned until 1930 when a nunc pro tune decree was entered. While the proceedings before the Board were pending Bissell and Aspinwall had conveyed by deed to the United States. Held: 1. This Court accepts a concurrent finding by the District Court and the Circuit Court of Appeals that the lands in question were within the description of the deed to Castro. P. 508. 2. An adjudication in a mandamus proceeding brought by the respondents, that it was the duty of the Secretary of the Interior, under the Swamp Lands Act and the Act of July 23, 1866, to issue a patent of the lands here involved to California, and the issuance of it, are not décisive of any issue in this suit, and it is open to the United States to show that the lands did not pass under the Swamp Lands Act. P. 508. 3. The effect of the Swamp Lands Act was to invest the State in praesenti with an inchoate title to those lands falling within the description of the Act, to be perfected as of the date of the Act when the land should be identified and the patent issued. It did not include lands which the Government had not acquired, nor did it free any of them of obligations to which they were subject when it was passed. P. 509. 4. Swamp lands in California, being a part of the territory an-nexed by the Treaty of Guadalupe Hidalgo, were subject to ail obligations imposed upon the United States with respect to them under the principles of international law by reason of the annexa-tion, and by treaty obligations. P. 510. 5. The obligations assumed by the United States in respect of the territory annexed by the Treaty of Guadalupe Hidalgo ante-dated and were superior to any rights derived from the United States under the Swamp Lands Act. P. 511. 6. Claimants under the United States by virtue of statutes dis-posing of its public lands in California, are not “third persons” within the meaning of the Mexican Claims Act; and confirmation under that Act of claims under Mexican grants is conclusive upon ail claiming under the United States. P. 512. 7. Confirmation of titles under the Mexican Claims Act is as effective and conclusive upon patents under the Swamp Lands Act as if made at the date of the Treaty. P. 513. 501 UNITED STATES v. O’DONNELL. Opinion of the Court. 503 8. The decree of the Board of Land Commissioners confirming the title of Bissell and Aspinwall became final and conclusive within the provisions of the Mexican Claims Act, irrespective of the valid-ity of the District Court’s decree of affirmance. P. 513. 9. Proceedings under the Mexican Claims Act were not required to be adversary, and that they were not does not affect the validity of a détermination by the Board. P. 524. , 10. The acquisition by the United States of the title of Bissell and Aspinwall, while their claim was pending before the Board of Land Commissioners, did not involve, by reason of the State’s interest under the Swamp Lands Act, any breach of équitable duty tç California. Pp. 514 et seq. 11. There is no basis in the record for the conclusion that confirmation of the Bissell and Aspinwall claim by the Board of Land Commissioners was procured or allowed to stand through any fraud, concealment, bad faith, or breach of duty to California by the Government or its officers. P. 523. 12. The decree of the Board of Land Commissioners stands as a valid administrative détermination of the validity of the Castro grant, undisturbed by any subséquent judicial proceedings, and is conclusive upon California and those claiming under her. P. 524. 91 F. 2d 14, reversed. Certiorari, 302 U. S. 677, to review a decree reversing a decree of the District Court, which had held in favor of the United States in a suit brought by it to quiet title. Assistant Attorney General McFarland, with whom Solicitor General Reed, Assistant Solicitor General Bell, and Messrs. C. W. Leaphart, Oscar Provost and Philip Buettner were on the brief, for the United States. Messrs. William Stanley and James E. Kelby, with whom Mr. Gordon Lawson was on the brief, for respond-ents. Mr. Justice Stone delivered the opinion of the Court. This case in volves the validity of the title of the United States to a part of Mare Island in San Francisco Bay, 504 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S which was reserved for public purposes by Presidential Proclamation in 1850, was selected by the Secretary as a navy yard pursuant to Act of Congress, was reserved for that purpose by Presidential Order in 1853, and since 1854 has been so used. The lanjls in question are in the area acquired as a resuit of the Mexican War by the Treaty of Guadalupe Hidalgo, July 4, 1848, 9 Stat. 922, which guaranteed the property rights of Mexicans in the annexed territory. The United States claims under deed to it in 1853 by Bis-sell and Aspinwall and another, who derived their title under grant of May 20, 1841, by Alvarado, Mexican Gov-ernor of California, to Castro, a Mexican citizen, of the island La Yegua (Mare Island) “in ail its extent.” Respondents claim under a patent issued by California to Darlington in 1857, purporting to convey the land in question as a part of the swamp or overflowed lands granted to the state by the Swamp Lands Act of Congress, Sept. 28, 1850, c. 84, 9 Stat. 519. Upon the military occupation of California during the Mexican War the United States military commander had proclaimed officially that Mexican land titles would reçoive due récognition by the United States,1 and Art. 8 of the Treaty of 1848 with Mexico declared that the property rights of Mexicans in the annexed territory should be “inviolably respected.” After the admission of California to statehood, September 9, 1850, Congress adopted the Mexican Claims Act of March 3, 1851, 9 Stat. 631, which established a Board of Land Commissioners with author-ity, upon pétition of those claiming under Mexican or Spanish grants of land in the annexed territory, to pass Proclamation to the Inhabitants of California, July 7, 1846, at Monterey, by Commodore John D. Sloat, 29th Cong., 2d Sess., House Doc. No. 4, pp. 644-645; Proclamation, August 17, 1846, at Ciudad de Los Angeles, by Commodore and Governor R. F. Stockton, id., pp. 669-670. UNITED STATES v. O’DONNELL. 505 501 Opinion of the Court. upon the validity of the grants. Right to a review of the Board’s détermination by the district court, and the Suprême Court of the United States, was allowed the claim-ants and the Government. By § 12 of the Act of August 31, 1852, 10 Stat. 76, 99, the Attorney General was given authority over appeals from decisions of the Board adverse to the interests of the United States. Bissell and Aspinwall, the grantors of the United States, filed their pétition before the Board, seeking confirmation of their title under the Castro grant of May 20, 1841. After hearing evidence the Board confirmed their title by decree of May 8,1855. Upon appeal by the United States to the district court for northem California, the decree of the Board was affirmed. Appeal by the Government to the Suprême Court of the United States, allowed by the district court April 1, 1857, was dismissed by the Government in the same year. The decree of the district court was not signed or entered until a decree nunc pro tune as of March 2,1857, was signed, filed and entered on April 15, 1930. While the proceedings were still pending before the Board, the claimants, Bissell and Aspinwall, on December 15, 1852, executed a contract to sell Mare Island to the United States, and on January 4, 1853, for a considération of $83,491, they joined in a deed to the United States, without covenants except for further assurance. The deed purported to convey Mare Island, “including ail the Tule or low land and marsh belonging to the same or which has ever been reputed or claimed to belong to the same . . On February 28, 1853, they executed a bond in favor of the United States in the sum of $200,000, condi-tioned upon the validity of their contract and the convey-ance of “the entire and absolute fee simple Estate in the said tract of land known as Mare Island.” The bond re-cited that they “shall at ail times hereafter indemnify and save harmless the United States against any claim or title 506 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. to the said tract called Mare Island and its appurtenances which may be set up by or through any person or persons claiming under Victor Castro and his assigns” and that they should “also indemnify and save harmless the United States against any adverse claim or title in any other person or persons or body politic which may within two years from the date hereof, be made and thereafter be success-fully established.” The 1857 California patent to Darlington was not re-corded until June 6, 1879, when one Sawyer appears to hâve acquired the Darlington claim. See Sawyer v. Oster-haus, 212 Fed. 765, 767. The Secretary of the Interior having found that the lands in question were swamp lands within the Swamp Lands Act of 1850, the respond-ents in 1928 by mandamus compelled the Secretary to certify the lands for patent to the State of California. The court, in awarding the relief sought, at the same time declared with reference to the contentions made here, “the mere issuance of patent to California détermines no legal or équitable right of the United States in the prem-ises.” Work v. United States ex rel. O’Donnell, 23 F. (2d) 136, 138. The présent suit was brought by the United States in the district court for northern California to quiet its title. Respondents, by their answer, put in issue the Govem-ment’s ownership of the lands in question and asserted their title as tenants in common under the Darlington grant. They specifically challenged the existence and validity of the Castro grant, the validity of the decrees of confirmation of the title of Bissell and Aspinwall, and any prescriptive title of the United States. They prayed, as affirmative relief, that their title be quieted, and in support of their prayer alleged that the lands in question were not embraced in the Castro grant and also were swamp lands which had passed to California under the Swamp Lands Act. 501 UNITED STATES v. O’DONNELL. Opinion of the Court. 507 The trial court made findings of fact and reached conclusions of law in favor of the United States on ail these issues. Upon appeal, the Court of Appeals for the Ninth Circuit reversed and decreed “that the United States has no title to the patented lands in suit, and that the title is in and quieted in” respondents. 91 F. (2d) 14. The Court of Appeals found that Alvarado, the Mexican Gov-ernor of California, had executed the purported grant of Mare Island to Castro, including the land in question, but made no finding with respect to the adverse possession of the United States found by the district court. It held that the paper signed by Alvarado was incompetent evidence of the grant to Castro because of the lack of filing or recordation of the grant in the Mexican archives, see Berreyesa v. United States, 154 U. S. 623, and that the decrees of the Board of Land Commissioners and of the district court on appeal from the Board, confirming the Castro title, were null and void and worthless as evidence because the United States had purchased the interest of the claimants Bissell and Aspinwall while the proceedings were pending before the Board. It charac-terized the proceeding as collusive and the action of the United States in acquiring title during its pendency as breach of a trust duty assumed under the Swamp Lands Act to convey swamp lands to California, and as in effect a fraud upon the state. It rejected the contention of the United States that the pending Board proceeding for confirmation of the Castro grant withdrew the land in question from the operation of the Swamp Lands Act, which is the source of California’s and respondents’ alleged title to the land, and held that the réservations of the land made by Presidential proclamations for military and naval purposes were ineffective, because California had previously acquired an inchoate title under the Swamp Lands Act. 508 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. Respondents renew here the contention made below, based on an elaborate review of the evidence, that the swamp or overflowed lands in question were below high tide and were not within the exterior boundaries of Mare Island as it was known at the time of the Castro grant, and so were not intended by the grantor to be, and were not in fact, included in the description of the grant. Resolution of this issue turns upon appraisal of the evidence and the inferences to be drawn from it. As both courts below hâve found against respondents on this issue we shall not réexamine the evidence here. We accept the concurrent findings as establishing the fact that the lands in question were within the description of the deed to Castro. United States v. State Investment Co., 264 U. S. 206, 211; Shappirio v. Goldberg, 192 U. S. 232; cf. Page n. Rogers, 211 U. S. 575; Washington Securities Co. N. United States, 234 U. S. 76; National Bank v. Shackle-ford, 239 U. S. 81 ; Risty n. Chicago, R. I. & P. Ry. Co., 270 U. S. 378. Nor is the fact that a patent has issued to California, in obedience to the judgment in the mandamus proceed-ing brought by respondents in Work v. United States ex rel. O’Donnell, supra, décisive of any issue presented here. Upon the Secretary’s approval of the survey of the land in question by the United States Surveyor General for the State of California, showing the lands to be swamp and overflowed at the date of the Swamp Lands Act, and the détermination by the Secretary that the lands in question were then swamp and overflowed, it became his duty under the Swamp Lands Act, and under the Act of Congress of July 23, 1866, 14 Stat. 218, to certify the lands for patent to the state. See Tubbs v. Wilhoit, 138 U. S. 134. But the adjudication in mandamus that it was the duty of the Secretary to issue the patent under these acts, and the issuance of it, deter-mined no legal or équitable right of the United States UNITED STATES v. O’DONNELL. 509 501 Opinion of the Court. in the premises. It remains open to the United States in this or any other appropriate proceeding, to show that the lands did not pass under the Swamp Lands Act. United States v. Schurz, 102 U. S. 378, 404; Smelting Ço. v. Kemp, 104 U. S. 636, 641, 646; United States v. Con-way, 175 U. S. 60, 68, and cases cited; see Work v. United States ex rel. O’Donnell, supra, 137, 138. We accordingly direct our attention to the question, deemed pivotai below, whether, as the Court of Appeals held, the confirmation of the title of Bissell and Aspinwall under the Castro grant by the Board of Land Commis-sioners was invalid, so that the United States neither re-served nor acquired a title valid as against the State of California and respondents who claim under her. In an-swering, it will be an aid to adéquate understanding of the points in issue to consider first the effect of the confirmation by the Board, without reference to the alleged collusion and fraudulent action of the United States or any of its officers. The Swamp Lands Act of 1850 was effective to transfer an interest in the lands described in the Act, only so far as they were part of the public domain of the United States and thus subject to the disposai of Congress. The Act in terms purported to grant to the several states ail swamp and overflowed lands located within their respective boundaries “which shall remain unsold at the passage of this Act.” Section 2 made it the duty of the Secretary of Interior “to make out an accurate list and plats” of the lands described by the Act and to “cause a patent to be issued to the state therefor.” The effect of these provisions was to invest the state in praesenti with an inchoate title to those lands falling within the description of the Act, to be perfected as of the date of the Act when the land should be identified and the patent issued as provided by § 2. Wright v. Roseberry, 121 U. S. 488; United 510 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. States v. Minnesota, 270 U. S. 181, 202-203. By its terms the Swamp Lands Act did not include swamp lands which the Government had sold, and it could not include lands which the Government had not acquired or free any of them of obligations to which they were subject when the Act was passed. United States v. Minnesota, supra, 206. It is a familiar principle of public land law that stat-utes providing generally for disposai of the public domain are inapplicable to lands which are not unqualifiedly subject to sale and disposition because they hâve been appro-priated to some other purpose. Wilcox v. Jackson, 13 Pet. 498, 513; Missouri, K. & T. Ry. Co. v. Roberts, 152 U. S. 114, 119; Scott v. Carew, 196 U. S. 100. This has been held to be the case even though the appropriation be afterwards set aside. Leavenworth, L. & G. R. Co. v. United States, 92 U. S. 733, 741, 745; Newhdll v. Sanger, 92 U. S. 761. The general words of the granting act are to be read as subject to such exception. Scott v. Carew, supra, 111, 112; Louisiana v. Garfield, 211 U. S. 70, 77; United States v. Minnesota, supra, 206. Swamp lands in California, being a part of the territory annexed by the Treaty of Guadalupe Hidalgo, were subject to ail obligations imposed upon the United States with respect to them under the principles of international law by reason of the annexation, and by its treaty obligations.2 Article 8 of the treaty stipulated 2 The obligation imposed by the principles of international law to respect property rights within annexed territory is substantially that recognized by the treaty, Soulard n. United States, 4 Pet. 511; United States v. Percheman, 7 Pet. 51, 87; Strother v. Lucas, 12 Pet. 410,’ 436; United States v. Repentigny, 5 Wall. 211, 260; Knight v. United States Land Assn., 142 U. S. 161, 184, and comprehends not only formai grants ‘'but also any concession, warrant, order or permission to survey, possess or settle, whether evidenced by writing or paroi, or presumed from possession.” Strother n. Lucas, supra, 436; see Sou-lard v. United States, supra. UNITED STATES v. O’DONNELL. 511 501 Opinion of the Court. that Mexicans then established in the annexed territory should retain their property within that area, and that property belonging to Mexicans not established there should be respected. The protocol of May 26, 1848, interprétative of the treaty, which preceded the exchange of ratifications on May 30, 1848, declared that the grants of land made by Mexico in the ceded territory “preserve the legal value which they may possess, and the grantees may cause their legitimate [titles] to be acknowledged before the American tribunals,” and that “Conformably to the law of the United States, legitimate titles to every description of property, personal and real, existing in the ceded territories are those which were legitimate titles under the Mexican law in California . . . up to the 13th of May, 1846 . . 61st Cong., lst Sess., Sen. Doc. No. 357, pp. 1119-1120. The obligations thus assumed by the United States antedated the Swamp Lands Act and were superior to any rights derived from the United States under that Act. The obligations were political in character, to be dis-charged in such manner and upon such terms as the United States might deem expédient in conformity to its treaty obligations. Beard v. Federy, 3 Wall. 478; Grisar v. McDowéll, 6 Wall. 363, 379; San Francisco v. LeRoy, 138 U. S. 656; Knight v. United States Land Assn., 142 U. S. 161, 183, 184. While the treaty provided that the claimants under Mexican grants might cause their titles to be acknowledged before American tribunals, it was silent as to the mode of sélection or création of such tribunals. The United States was left free to provide for them in its own way. Cf. United States v. Ferreira, 13 How. 40, 45. It could relegate ail the multitude of daims under the Mexican grants to the ordinary procedure of courts with the inévitable delays and confusion affecting land titles in the vast annexed area. See Beard v. Federy, 512 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. supra, 493. It could set up an administrative tribunal acting by a more summary procedure3 designed to estab-lish with finality the status of ail the Mexican grants as of the date of annexation. It chose the latter course by the création of the Board of Land Commissioners, by the Act of March 3, 1851. Under that Act the General Land Office was required to issue a patent for ail claims finally confirmed “by the said commissioners, or by the said District or Suprême Court.” The act declared that final decision of the Board, or the district or the Suprême Court should “be conclusive between the United States and the said claimants only, and shall not affect the interests of third persons.” Lands, the claim for which should be finally rejected, and lands, claims to which should not be presented to the Board within two years of the date of the Act were to be “deemed, held, and considered as part of the public domain.” The primary purpose of the Mexican Claims Act was the performance by the United States of its treaty obligations to quiet the tîtles of the claimants under Spanish and Mexican grants. But a necessary conséquence of proceeding before the Commission, and one incidental to the détermination of the validity of the titles of such claimants, was a détermination whether, by the cession, the lands in question had become a part of the public domain of the United States. It is évident that the treaty obligations to quiet the title of claimants under Mexican grants would be defeated and the Mexican Claims Act would fail of its purpose if the finality of the Board’s confirmation of claims under Mexican grants could be chal-lenged by persons claiming under grants of public lands by the United States. For that reason it has been con-sistently held that claimants under the United States, by virtue of statutes disposing of its public lands in Cali- 3 As to the number of the claims and the celerity with which they were disposed of, see 8 Op. Atty. Gen. 515. 501 UNITED STATES v. O’DONNELL. Opinion of the Court. 513 fornia, are not “third persons” within the meaning of the Mexican Claims Act, and that confirmation under that act of claims under Mexican grants is conclusive upon ail those claiming under the United States. Beard v. Federy, supra, 493; More v. Steiribach, 127 U. S. 70; San Francisco v. LeRoy, supra; Knight v. United States Land Assn., supra, 184; Ward v. Muljord, 32 Cal. 365, 370; People v. San Francisco, 75 Cal. 388, 400; 17 Pac. 522; cf. United States v. Coronado Beach Co., 255 U. S. 472, 488. Such is the effect of confirmation by the Board of titles set up under Mexican grants, upon claimants under the Swamp Lands Act to lands in the annexed territory. That the Swamp Lands Act antedated the Mexican Claims Act and the confirmation of titles under it, is immaterial ; for those claiming under the Swamp Lands Act took cum onere— subject to the treaty obligations of the United States and whatever procedure the United States might adopt in performance of those obligations for the quieting of titles under Mexican grants. Confirmation when made was as effective and conclusive upon ail patents under the Swamp Lands Act as if made at the date of the treaty. San Francisco v. LeRoy, supra, 670; Knight v. United States Land Assn., supra, 185; Ward v. Mulford, supra, 370. We do not stop to discuss the point, much argued at the Bar and in the briefs, whether the decree of the district court affirming the Board’s decree of confirmation was void or otherwise defective because not signed at or about the time it was rendered. See Mitchell v. Overman, 103 U. S. 62, 64-65; In re Wight, 134 U. S. 136; United States v. Stollar, 180 Fed. 910, 912, 913 ; International Harvester Co. v. Carlson, 217 Fed. 736, 738. If it be taken that the Government has failed to prosecute its appeal to final decree in the district court, it is enough that the decree of the Board has never been set aside or otherwise disturbed. If the appeal was not still pending when the decree of the district court was entered nunc pro tune in 1930, the de-53383°—38-------33 514 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. créé of the Board remains as effective as if no appeal had been taken, and has become final and conclusive within the provisions of the Act. Beard n. Federy, supra; United States v. Ritchie, 17 How. 525. Apart from the considérations growing out of the pur-chase by the Government of the Bissell and Aspinwall title, now to be discussed, the decree of the Board, if not that of the district court, must be taken as conclusive on respondents, and as to them it is not open to this or any other court to reëxamine the existence or validity of the Castro grant. The holding of the court below that the acquisition by the United States of the title of Bissell and Aspinwall, while their claim was pending before the Board of Land Commissioners, involved a breach of équitable duty to California of such character as to preclude the Government from taking any advantage of the Board’s confirmation of the Castro grant, is predicated upon the assump-tion that by virtue of the Swamp Lands Act the United States became in effect the trustée of the lands in question for the benefit of the state and its successors in interest. It is true that in a loose and general sense the United States, pending issuance of a patent under other land grant acts, has been referred to as a trustée of lands to be patented, Cornélius v. Kessel, 128 U. S. 456, 460-1 ; Ben-son Mining & Smelting Co. v. Alta Mining & Smelting Co., 145 U. S. 428, 432; Orchard v. Alexander, 157 U. S. 372, 383; United States v. Anderson, 194 U. S. 394; Knapp v. Alexander-Edgar Lumber Co., 237 U. S. 162; Payne v. New Mexico, 255 U. S. 367, and the right of the state, before patent, to lands within the purview of the Swamp Lands Act has been referred to as “équitable.” Michigan Land & Lumber Co. v. Rust, 168 U. S. 589, 591 ; Brown v. Hitchcock, 173 U. S. 473, 476. Even where the right of the state under the Swamp Lands Act is unqualified, it would perhaps be more ac- 501 UNITED STATES v. O’DONNELL. Opinion of the Court. 515 curate to say that the United States is no more than a donor granting without warranty those lands falling within the description and the purview of the statute, subject to a duty imposed by the statute, to perfect by survey and patent such inchoate title as it had conveyed to the state. Beyond this the United States, by the enactment of the Swamp Lands Act, assumed no duty. It gave no warranty of title. It assumed no obligations to the grantee subjecting itself to other claims of équitable duty. Sale of the lands to others does not make it ac-countable as a trustée of the proceeds. United States v. Louisiana, 127 U. S. 182, 191. In any case, the duty assumed by the United States under the treaty and the concomitant power thus reserved to it, was inconsistent with the assumption of trust duties toward the state by reason of the Swamp Lands Act. In the execution of that duty it was free to adopt any mode of procedure it saw fit for adjudication of the titles of claimants under Mexican grants. Even after the submission of their claims to the Board of Land Commissioners it could withdraw them from decision of the Board and courts and adjudicate them by Congressional action. Grisar v. Mc-Dowell, supra, 379. The tentative récognition by the treaty of the rights of the Mexican grantees and the full latitude which the Government had reserved to itself in the choice of modes of disposition of those claims, were incompatible with the assumption of trust duties by the Government with respect to them pending their final disposition. There is thus a complété absence of support for the supposed analogy between a sovereign government, in such circumstances, and a private grantor who has conveyed with warranty of title or who has undertaken by executory contract to convey title which he possesses or subsequently acquires and who, because he has thus assumed équitable duties, is sometimes spoken of as a trustée. 516 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. The Mexican Claims Act itself neither imposée! nor recognized such duties. In authorizing the Board to pass on claims presented to it upon the evidence adduced by the claimant and the United States, it required no notice to be given to any third party. It gave to the Government the right to représentation by an agent and made it his duty to collect testimony “in behalf of the United States,” and to attend meetings of the Board. But the rôle of the Government was not that of a litigant. It was rather, as the Act itself declared, supervisory: “to superintend the interests of the United States” in the performance, through an administrative agency, of its treaty obligation to ascertain for the Mexican claimants, and for itself, what lands had been withdrawn from the public domain by the Mexican grants. “The United States did not appear in the courts as a contentious litigant; but as a great nation, acknowledging their obligation to recognise as valid every authentic title, and soliciting exact information to direct their executive Government to comply with that obligation.” United States v. Fossatt, 21 How. 445, 450, 451. At no stage of the Govemment’s dealing with the titles under Mexican grants, either under the Swamp Lands Act or under the Mexican Claims Act, can we find the as-sumption on the part of the Government of any duty toward the state with respect to the swamp and over-flowed lands other than that specified in the Swamp Lands Act itself, and that duty was fully performed when it issued to the state its patent to the lands in question in response to the mandate in Work v. United States ex rel. O’Donnell, supra. We turn now to the considération of the circumstances relied on to establish the proposition that the title now asserted by the United States was acquired as the resuit of a purposeful or conscious scheme to deprive the state of possible benefits under the Swamp Lands Act by means UNITED STATES v. O’DONNELL. 517 501 Opinion of the Court. of collusive proceedings before the Board of Land Com-missioners and the district court. At the outset it is to be noted that this contention first emerges in this case in the opinion of the Court of Appeals below. There had previously been no suggestion of such a contention in any pleading or assignment of error, nor had the Government or its officers been charged with any fraud, collusion, concealment, or bad faith. The respondents, in seeking affirmative relief, made no assertion of that char-acter. In such a state of the record, dereliction of officers of the United States in the performance of official duty is not lightly to be inferred seventy-five years after the event, and a court should be slow to find what would be in effect a fraudulent conspiracy on their part to deprive the state of the benefits of the Swamp Lands Act. Upon the sélection of Mare Island as a navy yard by the Secretary of the Navy, Mr. Crittenden, then Attorney General, had given an opinion to the effect that Mare Island was a part of the public domain subject only to the Castro grant, the claim under which was then pending before the Board of Land Commissioners. He concluded that there was sufficient basis for the claim to justify purchase of the claimant’s title, which he recommended as a protection of the interests of the Government. See Opinion of Attorney General Cushing given to the Secretary of the Navy, April 9, 1853. 8 Op. Atty. Gen. 422. Then followed the purchase from Bissell and Aspinwall, in the circumstances already detailed. Those circum-stances justify no inference that the defense of their claim was dishonest. The Government had far more to gain than to lose by defeating the Castro grant. As the grant covered the island “in ail its extent,” both upland and swamp, rejection of the claim would not only hâve given to the Government a return of the purchase price and expenses as guaranteed by its bond for title, but would hâve established its right to the entire island as a part 518 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. of the public domain, except perhaps the swamp land. Cf. Newhall v. Sanger, supra. The validity of the Castro grant was the only matter with respect to which the Board could render a decree which, under the procedure of the Mexican Claims Act, could become final and conclusive as to the claimant and the Government. So far as appears, each was as much concerned with the détermination of that question after as before the Bissell and Aspinwall deed and bond, for accordingly as it was decided one way or the other, the one or the other stood to gain an amount equal to the purchase price of the property. The reasonableness of the purchase price is not challenged. The only effect of the deed and bond was to protect the Government against loss of the oppor-tunity to acquire the land for a navy yard in case the property should be disposed of to some third person pending the Board’s decision, and the Castro grant should be upheld. Upon the opinion of Attorney General Cushing, already mentioned, the Court of Appeals placed its chief, indeed its only reliance for the conclusion that there was con-scious dereliction on the part of the Government. In this opinion the Attorney General spoke of the Govem-ment’s purchase of the Bissell and Aspinwall title as an accomplished fact, but nevertheless recommended that the claim be vigorously contested. This is said to be so inconsistent with the Government’s dismissal of its appeal four years later as to indicate a “purposeful shift of position” to the détriment of the state, from which bad faith is to be inferred. But an attentive reading of the opinion in the light of subséquent events reveals no such incon-sistency. In repudiating any thought that the claim should not be contested, he declared : “But I, as Attorney General, in view of the spécial duties imposed on me by the acts for settlement of private land claims in Cali- 501 UNITED STATES v. O’DONNELL. Opinion of the Court. 519 fomia, and of my general obligation to look after the rights of the United States in the promises, cannot pursue this course. I must not admit that the purchase of the Castro claim by the United States opérâtes in any way, either by implication or otherwise, as a waiver of the general rights of the United States in the promises, or as an assent, either express or implied, to the pretended validity of the grant to Castro.” He pointed out that the claim “involves difficult and important questions of law, which the Commissioners, to be sure, hâve decided in favor of the claimants,4 but which the Suprême Court may décidé otherwise,” and that he felt bound to protect the interests of the United States by an appeal because as a precedent the case would affect “many millions worth of land in California, which is otherwise public domain.” After pointing out that the State of California retained title to tide land below high water mark, and that the United States could not enjoy the use of Mare Island as a naval depot while its shores belonged to the state, he concluded with the recommendation that “California be invited to relinquish to the United States whatever claim, if any, she may hâve to the shores or the overflowed land of Mare Island.” The opinion discloses that he had no thought of depriving the state of any rights which it might hâve under the Swamp Lands Act for it affirmatively shows thàt he was of opinion (erroneously as was later decided in Beard v. Federy, supra, and cases following it), that no rights of California under the Swamp Lands Act would be affected by the decisions of the Board. With but little research it becomes apparent that the important questions of law affecting “many millions worth of 4 The reference is obviously to claimants other than Bissell and Aspinwall, for at that time there had been no hearings by the Board on the claim of the latter and the Board had rendered no decision with respect to it. 520 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. land in California,” which were involved in the Bissell and Aspinwall claim and which the Commissioner had already deçided in other cases, were unrelated to any rights of the state under the Swamp Lands Act, and were in fact decided against the Government by this Court after the Attorney General had rendered his opinion and before the dismissal of the Government’s appeal from the decree of the district court in the Bissell and Aspinwall case.5 The opinion 5 Of the “difficult and important questions of law” which were said in Attorney General Cushing’s opinion to the Secretary of the Navy to be involved in the claim of Bissell and Aspinwall, one, mentioned in the letter itself, was whether a grant by a Mexican govemor was valid in the absence of approval by the “Departmental Députation.” This question was answered in the affirmative by the Board, December 27, 1852, in passing on the Fremont claim; January 5, 1853, in the Larkin case; and in preliminary opinions in the Cervantes and Reading cases, rendered August 3, 1852, and August 9, 1852, re-spectively. This Court agreed with the Board on the general proposition, in Fremont v. United States, 17 How. 542, 563 (March 10, 1855) ; United States v. Reading, 18 How. 1, 7-8 (January 11, 1856) ; United States v. Larkin 18 How. 557, 563 (May 12, 1856). A spécial rule to the contrary was later pronounced as to island grants in United States v. Osio, 23 How. 273, decided March 12, 1860, but it cannot be said from the présent record whether that rule was applicable to the Castro grant. Also involved in the claim of Bissell and Aspinwall were five other questions, each of which had been decided by the Board before the Attorney General’s opinion of April 9, 1853, and before the Board’s later confirmation of the Bissell and Aspinwall claim. Each was decided by this Court against the Govemment before its dismissal of the appeal which it had taken April 1, 1857, from the district court’s affirmance of that confirmation. The questions were: (a) Whether the Mexican provincial govemors had power to grant lands. It was decided in the affirmative in the preliminary opinion on the Cervantes claim, rendered by the Board August 3, 1852, and in a number of subséquent decisions, and was settled by this Court March 5, 1857, in United States v. Peralta, 19 How. 343. (b) Whether the Mexican governors had power to grant any lands within ten leagues of the seacoast—the so-called littoral league question. It was decided adversely to the Government in a preliminary 501 UNITED STATES v. O’DONNELL. Opinion of the Court. 521 évidences the strongest motives on the Government’s part to contest the Bissell and Aspinwall claim, and the firm détermination to prosecute the contest with vigor. The record of the proceedings before the Board plainly shows adhérence to this purpose. Witnesses were produced by the Government to discrédit the Castro grant; those produced by the claimants, including Alvarado who testified to his execution of the grant, were so vigorously cross-ex-amined as to excite the Board’s “strong suspicion” as to the authenticity of the Castro grant, which it nevertheless sustained in the light of ail the evidence. Only after the “important questions of law” had been decided by this Court against the Government did it relax its efforts. Its change of position then, though purposeful, can hardly be said to be evidence of bad purpose. The deed of Bissell and Aspinwall to the Government was recorded in Solano County, California, April 18, 1853. opinion in the Cervantes case, rendered by the Board August 3, 1852, and was settled by this Court May 12, 1856, in Arguello v. United States, 18 How. 539, and United States v. Cervantes, 18 How. 553. (c) Whether the grantee’s failure to fumish a map (diseno) with his pétition for a grant, constitutes a fatal defect in title. It was decided by the Board adversely to the Government in the Fremont case, December 27, 1852, and was settled by this Court March 10, 1855, in Fremont v. United States, supra. (d) Whether a grant is void for want of a condition requiring the grantee to take possession of and cultivate the land within a certain time. It was decided by the Board in the négative in the Larkin case, January 3, 1853, and was settled by this Court May 12, 1856, in United States v. Larkin, supra. (e) Whether a grant is void for want of a clause informing the grantee that it would become indefeasible only after approval by the Departmental Députation. It was involved in the Larkin claim, con-firmed by the Board January 3, 1853, and was settled by this Court May 12, 1856, in United States v. Larkin, supra. Chronological data hâve been secured from Hoffman’s Land Cases, Appendix, and from the records filed in this Court in the cited cases. 522 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. The opinion of Attorney General Cushing was in October 3, 1853 transmitted by the Secretary of the Navy to the Governor of California who submitted it to the California Législature January 4, 1854. California Senate Journal, 1854, 37 ; Appendix, Doc. No. 4. Being then fully advised by that opinion of the Government’s purchase of the Bis-sell and Aspinwall claim and of its purpose to press for a détermination of the validity of the Castro grant by the Board of Land Commissioners, the California Législature by Act of May 11, 1854, Cal. Stat. 1854, c. 43, pp. 48-49, consented to the purchase of Mare Island for the purpose of establishing there a navy yard and proclaimed that ail the lands within its limits were to be perpetually free of state taxation. It ceded to the Government lands on the island which are not here involved, with the proviso that the consent to the purchase and the cession to the Government should not “be construed in aid or support, directly or im-pliedly, of any conveyance or bond for title to the United States of the same lands heretofore made, or which may hereafter be made ... or as a récognition on the part of the State of California of any claim, title or grant heretofore asserted or set up, or which may hereafter be as-serted or set up by any person or persons . . The only bond for title then relating to Mare Island which is dis-closed by the record was that ôf Bissell and Aspinwall, and the apparent purpose of the proviso was that the state’s consent to the purchase should not enure to the benefit of Bissell and Aspinwall or any others in like situation, so as to relieve them from the obligation on their bond in the event that the Castro grant should be held invalid by the Board of Land Commissioners. Occupation of the island by the United States as a naval station followed in Sep-tember, 1854. The Board rendered its decree of confirmation of the Castro grant May 8, 1855. The following mémorandum appears among the papers in the case in the district court: “The United States being now the owner of 501 UNITED STATES v. O’DONNELL. Opinion of the Court. 523 the titles of appellees, a confirmation of this claim enures to the benefit of the Government and no objection is there-forb made to a decree in favor of the validity of the claim.” Thus, instead of action covertly taken by the Government with the purpose of depriving the state of any of its rights in the premises, we find high officers of the Government proclaiming in documents submitted to the Governor and Législature of California the fact of the Government’s acquisition of a conditional interest in the Bissell and Aspinwall claim, and its purpose to secure a détermination of the validity of the grant by the Board of Land Commissioners. We see that, after this full dis-closure, the state expressed consent to the purchase in such a way as to save to the Government unimpaired its rights under the Bissell and Aspinwall bond. Only after the confirmation of the Castro grant by the Board of Land Commissioners, and only after the important questions of law on which the Government relied to defeat the grant had been decided against it by this Court in other cases, did the Government relinquish its purpose to contest the Bissell and Aspinwall claim. We can find in this record no basis for saying that the confirmation by the Board was procured or allowed to stand through any fraud, concealment, bad faith, or breach of duty to California by the Government or its officers. The contention that the decree of the Board is open to collateral attack as a nullity is thus reduced to the assertion that, by reason of the conditional interest of the Government under the Bissell and Aspinwall deed and bond, the contest before the Board may hâve been in some degree less vigorous than it otherwise would hâve been. To this the answer is that, as already shown, the Government owed no duty to the state to contest the claim and that in any case the proceeding before the Board was not adversary. 524 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. The Board was an administrative body, created as the Act déclarés “to ascertain and settle the private Land Claims in the State of California,” by proceedings which were not required to be controversial. It was begun without notice to any other party. While the attendance by the “agent” of the United States was required in order that he might “superintend the interests of the United States,” it did not appear in the rôle of litigant. United States v. Fossatt, supra. The Board was an administrative body, not a court. United States v. Ritchie, supra; United States v. Fossatt, supra. Review of its proceedings by direct appeal was not within the judicial power,. and reëxamination of its déterminations by the district court and the United States Suprême Court was sustained only on the theory that the appeal to the district court was the initiation of a suit to set aside the détermination of the Board, in the course of which suit further evidence might be taken. United States v. Ritchie, supra, 533, 534; Grisar v. McDowell, supra, 375. Since the statute under which the Board was created did not require adversary proceedings, the validity of its administrative détermination was unaffected by their absence. The decree of the Board, which stands undis-turbed by any subséquent proceedings in the courts, cannot be disregarded as a nullity. We conclude that the acquisition of the interest in the Bissell and Aspinwall title by the United States did not undermine that détermination; that the proceedings in connection with their claim before the Board of Land Commissioners were free from fraud, bad faith, conceal-ment or overreaching, and of any breach of duty to California on the part of the United States or its officers; and that the decree of the Board stands undisturbed as a valid administrative détermination of the validity of the Castro grant and, as such, is conclusive upon the State 501 CALMAR S. S. CORP. v. TAYLOR. Statement of the Case. 525 of California and on respondents who claim under her. The decree below must accordingly be Reversed. Mb. Justice Cardozo and Mr. Justice Reed took no part in the considération or decision of this case. CALMAR STEAMSHIP CORP. v. TAYLOR. CERTIORARI TO THE CIRCUIT COURT OF APPEALS FOR THE THIRD CIRCUIT. No. 594. Argued March 9, 1938.—Decided March 28, 1938. 1. The right of a seaman to maintenance and cure for an illness which befalls him during his service may continue for a period beyond the duration of the voyage, whether he be at home or abroad, and even though the illness be not caused by the employment. P. 529. 2. In the case of a seaman suffering from an incurable disease, which manifested itself during his employment but was not caused by it, the duty of the ship owner to furnish maintenance and cure does not extend beyond a fair time after the voyage in which to effect such improvement in the seaman’s condition as reasonably may be expected to resuit from nursing, care, and medical treatment. P. 530. 3. In a suit brought by a seaman suffering from an incurable disease, which manifested itself during his employment though not caused thereby, an award of a lump sum in anticipation of a continuing need of maintenance and cure for life (based on his life expect-ancy), can not be sustained. P. 530. 4. The seaman’s recovery in each such case must be measured by the reasonable cost of that maintenance and cure to which he is entitled at the time of the trial, including, in the discrétion of the court, such amounts as may be needful in the immédiate future for the maintenance and cure of a kind and for a period which can be definitely ascertained. P. 531. 92 F. 2d 84, reversed. Certiorari, 302 U. S. 681, to review a decree affirming an award against the steamship company in a suit in admiralty for maintenance and cure. 526 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. Mr. Frank A. Bull, with whom Messrs. O. D. Duncan and Russell T. Mount were on the brief, for petitioner. Mr. Abraham E. Freedman, with whom Mr. Howard M. Long was on the brief, for respondent. Mr. Justice Stone delivered the opinion of the Court. The question for decision is whether the duty of a ship owner to provide maintenance and cure for a seaman falling ill of an incurable disease while in its employ ex-tends to the payment of a lump sum award sufficient to defray the cost of maintenance and cure for the remainder of his life. Respondent was a member of the crew of petitioner’s steamship “Losmar.” Following an injury to his foot, allegedly caused by stubbing his toe against an object lying on the floor of the boiler room where he was em-ployed, respondent was found to be afflicted with thrombo angiitis obliterans, otherwise known as Buerger’s disease, an incurable malady of the veins and arteries. It is attended by interruptions of the blood stream, with conséquent malnutrition of the affected parts, producing lésions, deteriorating changes of the tissues, and gangrené. Medical treatment and amputation of the affected parts may hait the advance of the disease, but its manifestations are likely to recur in other parts of the body, and medical opinion is that the disease tends to be progressive and may ultimately cause death. Care and treatment at frequent intervals, with periodic medical observation of the patient, are of aid in arresting its progress. After February 12, 1935, when respondent was first hospitalized, he was given treatment at various marine hospitals, in the course of which he suffered four amputations upon the right foot and leg. On October 3, 1935, after his leg had been amputated below the knee, he 525 CALMAR S. S. CORP. v. TAYLOR. Opinion of the Court. 527 was discharged to the “Outpatient Department to return at intervals for reëxamination, and later to be fitted with an artificial limb.” Petitioner, from time to time, paid respondent small sums for maintenance and cure, con-tinuing to do so until March 10, 1936, when they totaled $487. At about this time respondent brought the présent suit in admiralty to recover maintenance and cure, and, in another count, for petitioner’s négligence in causing the injury. The trial court found that petitioner was not négligent, but held that respondent is entitled to recover the cost of maintenance and medical treatment so long as such treatment is necessary, and that as his affliction is incurable, there should be a lump sum award based on his life expectancy. Its decree awarding a recovery of $7000 was affirmed by the Court of Appeals. 92 F. (2d) 84. Because of the importance of this question, we granted certiorari, 302 U. S. 681, but denied a cross pétition to review the Court of Appeals’ affirmance of the decree for the ship owner on the négligence count, post, p. 643. The ancient duty of a vessel and her owner to provide maintenance and cure for seamen injured or falling ill while in service was recognized and, to some extent, de-fined by this Court in The Osceola, 189 U. S. 158, 175. See also Chelentis v. Luckenbach S. S. Co., 247 U. S. 372; Pacific S. S. Co. v. Peterson, 278 U. S. 130. The duty, which arises from the contract of employment, Cortès v. Baltimore Insular Line, 287 U. S. 367, 371, does not rest upon négligence or culpability on the part of the owner or master, id.; The City of Alexandria, 17 Fed. 390 (D. C.) ; The Mars, 149 Fed. 729, 731 (C. C. A.) ; Sorensen v. Alaska S. S. Co., 243 Fed. 280 (D. C.), aff’d 247 Fed. 294 (C. C. A.) ; Brown v. The Bradish Johnson, Fed. Cas. No. 1992, 1 Woods 301 (C. C.), nor is it restricted to those cases where the seaman’s employment is the cause of the in jury or illness. The Wensleydale, 41 528 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. Fed. 829 (D. C.); The Bouker No. 2, 241 Fed. 831 (C. C A.). It is not an award of compensation for the disability suffered, The Wanderer, 20 Fed. 140, 143 (C. C.), although breach of the duty may render the owner liable for the consequential damages suffered by the seaman. Cortès v. Baltimore Insùlar Line, supra, 371. The maintenance exacted is comparable to that to which the seaman is entitled while at sea, The Henry B. Fiske, 141 Fed. 188, 192 (D. C.) ; The Mars, 145 Fed. 446, 447, (D. C.), aff’d 149 Fed. 729 (C. C. A.); The Bouker No. 2, supra, 836, and “cure” is care, including nursing and medical attention during such period as the duty continues. Whitney v. Olsen, 108 Fed. 292, 297 (C. C. A.) and cases cited; Daugherty v. Thompson-Lock-hart Co., 211 Fed. 224, 227 (D. C.). In The Osceola, supra, this Court reserved the point whether the duty of maintenance and cure extends be-yond the duration of the voyage, and that question, so far as this Court is concerned, remains an open one. The reasons underlying the rule, to which reference must be made in defining it, are those enumerated in the classic passage by Mr. Justice Story in Harden n. Gordon, Fed. Cas. No. 6047 (C. C.) : the protection of seamen, who, as a class, are poor, friendless and improvident, from the hazards of illness and abandonment while ill in foreign ports; the inducement to masters and owners to protect the safety and health of seamen while in service; the maintenance of a merchant marine for the commercial service and maritime defense of the nation by inducing men to accept employment in an arduous and perilous service. It is plain that in many cases these purposes will not be accomplished if the owner’s duty to furnish maintenance and cure ends with the voyage. If the injury or illness outlasts it, the seaman may still be left helpless and uncared for in a foreign port. Even if he is returned 525 CALMAR S. S. CORP. v. TAYLOR. Opinion of the Court. 529 to the home port the inducement to the owner to care for the heaith and safety of seamen during the voyage and the inducement to seamen to take the necessary risks of a hazardous calling will be materially lessened. The chances of their prompt restoration to a service whose préservation is in the public interest, will be diminished if the right to maintenance and cure ends with the voyage. Tacit récognition is accorded these considérations in the great number of cases in the lower fédéral courts sustain-ing the right to maintenance and cure for a reasonable time after the voyage—“reasonable time” being appraised with reference to the spécial circumstances of each case. The Bouker No. 2, supra, 835, and cases cited at 834. It is true that in most of these cases the efficient cause of the in jury or illness was some proven act of the seaman in the service of the ship, but there are others in which it was deemed enough that he was incapacitated when sub-ject to the call of duty as a seaman, and that his inca-pacity continued after the voyage had ended. The Bouker No. 2, supra, 835; The Wensleydale, supra. We accept as supported by evidence, the finding of the district court that respondent’s disease and the amputations which he suffered were not caused by the injury to his foot. But we think that even in such a case, whether the seaman is at home or abroad, his right to maintenance and cure may outlast the voyage. The policy underlying the obligation, so cogently stated by Justice Story in Harden v. Gordon, supra, and the liberality with which admiralty courts hâve traditionally inter-preted rules devised for the benefit and protection of seamen who are its wards, Robertson v. Baldwin, 165 U. S. 275, 287; Cortès v. Baltimore Insular Line, supra, 377; The Arizona v. Anelich, 298 U. S. 110, 123, call for some extension of the duty beyond the term of service. The practical inconvenience and the attendant danger to seamen in the application of a rule which would en-53383°—38-------34 530 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. courage the attempt by master or owner to détermine in advance of any maintenance and cure, whether the illness was caused by the employment, are manifest. There remain the questions whether in the case of a chronic illness the duty continues so long as medical attendance and care are bénéficiai, until death if the need lasts so long, and whether a lump sum may be awarded to defray the cost of meeting the anticipated need. In answering the first we lay to one side those cases where the incapacity is caused by the employment. As to them considérations not présent here may apply, which might be thought to require a more liberal application of the rule than we think is called for in this case. Cf. Reed v. Canfield, Fed. Cas. No. 11641 (C. C.), with the comments of Judge, later Justice Brown in The J. F. Card, 43 Fed. 92 (D. C.), and see those of Judge Hough in The Bouker No. 2, supra, 834. But we find no support in the policies which hâve generated the doctrine for holding that it imposes on the ship owner an indefinitely continuing obligation to furnish medical care to a seaman afflicted with an incurable disease, which manifests itself during his employment, but is nôt caused by it. So far as we are advised it is without support in the authorities. We can find no basis for saying that, if the disease proves to be incurable, the duty extends beyond a fair time after the voyage in which to effect such improvement in the seaman’s condition as reasonably may be expected to resuit from nursing, care, and medical treatment. This would satisfy such demands of policy as underlie the imposition of the obligation. Beyond this we think there is no duty, at least where the illness is not caused by the seaman’s service. The award of a lump sum in anticipation of the continuing need of maintenance and cure for life or an in-definite period, is without support in judicial decision. Awards of small amounts to cover future maintenance 525 CALMAR S. S. CORP. v. TAYLOR. Opinion of the Court. 531 and cure of a kind and for a period definitely ascertained or ascertainable hâve occasionally been made. The Mars, 149 Fed. 729, 730 (C. C. A.) ; Wilson v. Manhattan Can-ning Co., 205 Fed. 996, 997 (D. C.). But the award here seems to us to be inconsistent with the measure of the duty and the purposes to be effected by its performance. The duty does not extend beyond the seaman’s need. Raymond v. The Ella S. Thayer, 40 Fed. 902, 903 (D. C.) ; The J. F. Card, supra, 95; The Bouker No. 2, supra, 835; The Santa Barbara, 263 Fed. 369, 371 (C. C. A.) ; Stewart v. United States, 25 F. (2d) 869, 870 (D. C.) ; Marshall v. International Mercantile Marine Co., 39 F. (2d) 551, 553 (C. C. A.); cf. H oit v. Cummings, 102 Pa. 212; contra, Reed v. .Canfield, supra. The amount and character of medical care which will be required in the case of an affliction, as well defined even as Buerger’s disease, cannot be measured by reference to mortality tables. Moreover, courts take cognizance of the marine hospital service where seamen may be treated at minimum expense, in some cases without expense, and they limit recovery to the expense of such maintenance and cure as is not at the disposai of the seaman through recourse to that service. The Bouker No. 2, supra, 835; Marshall v. International Mercantile Marine Co., supra, 553, and cases cited. Fur-thermore, a duty imposed to safeguard the seaman from the danger of illness without succor, and to safeguard him, in case of illness, against the conséquences of his improvidence, would hardly be performed by the pay-ment of a lump sum to cover the cost of medical attend-ance during life. The seaman’s recovery must therefore be measured in each case by the reasonable cost of that maintenance and cure to which he is entitled at the time of trial, including, in the discrétion of the court, such amounts as may be needful in the immédiate future for the maintenance 532 OCTOBER TERM, 1937. Syllabus. 303 U. S. and cure of a kind and for a period which can be definitely ascertained. The courts below hâve made no findings sufficient to enable us to fix the amount which respondent is entitled to recover. The decree is accordingly reversed and the cause remanded to the district court for further proceedings in conformity with this opinion, and without préjudice to any later suit by respondent to recover maintenance and cure to which he may then be entitled. Reversed. Mr. Justice Black is of opinion that the judgment should be affirmed. Mb. Justice Cardozo took no part in the considération or decision of this case. ADAMS, RECEIVER, v. NAGLE et al.* CERTIORARI TO THE CIRCUIT COURT OF APPEALS FOR THE THIRD CIRCUIT. No. 123. Argued December 16, 17, 1937. Reargued March 8, 9, 1938.—Decided March 28, 1938. Stockholders of the “P” and “R” national banks brought bills in equity to enjoin the receiver from enforcing assessments, ordered by the Comptroller of the Currency pursuant to the statute gov-erning the additional liability of shareholders, on the grounds that the action of the Comptroller in ordering the assessments was in excess of his statutory power, arbitrary, capricious, and a déniai of due process of law. The bills alleged, inter alia, that the Comptroller erroneously disregarded agreements theretofore entered into between the “P” and “R” and the “F” banks, whereby the first two conveyed ail of their assets to the last, which assumed ail of their liabilities except liabilities to stockholders, and out of which *Together with No. 124, Adams, Receiver, v. Tobias et al., also on writ of certiorari to the Circuit Court of Appeals for the Third Circuit. 532 ADAMS v. NAGLE. Counsel for Parties. 533 ' agreements arose claims against the “F” bank sufficient to pay the debts of the “P” and “R” banks without the necessity of assess-ment of stockholders. Upon the allégations of the bills, held: 1. The assessments were not subject to attack or frustration in these proceedings upon the grounds set forth in the bills. P. 538. 2. The agreements between the banks did not effect a consolidation in conformity with the National Banking Act, and the Comp-troller was bound to deal with them, so far as their assets and liabilities were concerned and in respect of stockholders’ liability, as three separate entities. P. 538. 3. It was not a condition precedent to the validity of the assessments that the Comptroller should hâve exhausted the assets of the “P” and “R” banks. P. 539. 4. The Comptroller’s détermination as to the necessity for the assessments was made in the exercise of the discretionary power vested in him and was final and conclusive. P. 540. 5. Collection of the assessments could not be made to await the outcome of litigation challenging the correctness of the Comptroller’s decision as to the effect of the agreements between the banks. P. 544. 88 F. 2d 936, reversed. Certiorari, 302 U. S. 665, to review a decree reversing orders of the District Court dismissing the bills of complaint in two suits brought by stockholders of two insolvent national banks to enjoin the receiver from en-forcing assessments ordered by the Comptroller of the Currency. By order of the trial court the cases were Consolidated for the purpose of appeal. Messrs. Charles E. Wainwright and George P. Bourse, with whom Messrs. Brice Clagett and Charles W. Matten were on the brief, for petitioners on the reargument and on the original argument. Mr. Lemuel B. Schofield, with whom Messrs. Edward W. Madeira and W. Bradley Ward were on the brief, for respondents on the reargument and on the original argument. 534 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. Mr. Justice Roberts delivered the opinion of the Court. These are stockholders’ suits to enjoin the receiver of two national banks from enforcing assessments ordered by the Comptroller of the Currency pursuant to the statute goveming the additional liability of shareholders.1 The respondents in No. 123 are stockholders of the Penn National Bank and Trust Company of Reading, Pennsylvania; those in No. 124 are stockholders of the Reading National Bank and Trust Company of the same city; and the petitioner is receiver of both banks. The controversy has its origin in a transaction between the two banks and the Farmers National Bank and Trust Company of Reading. The causes of action are identical and it will suffi.ee to outline the allégations of the bill in No. 123. These are: On February 17, 1933, Penn and Reading were sub-jected to unusual withdrawals which depleted their reserves and placed both on the verge of insolvency. Due to this condition the two banks on that date entered into an agreement with the Farmers contemplating a consolidation of the three in accordance with Title 12 U. S. C. §§33 and 34. The agreement called for a valuation of the assets of the three banks with ensuing recapitalization and for the Comptroller’s approval of the terms of consolidation as required by law. It further provided for transfer by Penn and Reading of ail their assets to Farmers, with the right to hypothecate and rehypothecate them, and for assumption by Farmers of the liabilities of the transferring banks except that to stockholders, they reserving the right to enforce against their stockholders any statutory excess liability. Farmers was to operate 1 R. S. § 5151; Act of Dec. 23, 1913, c. 6, § 23, 38 Stat. 273, U. S. C. Tit. 12, §§ 63 and 64. ADAMS v. NAGLE. 535 532 Opinion of the Court. their banking houses as its branches. On the same day Penn and Reading turned over their assets to Farmers, which mingled them with its own and thereafter dealt with them as its own. There is no assertion that on Feb-ruary 17 the Comptroller knew, or approved, of the agreement and transfer. It is alleged, however, that, by his direction, a supplémentai agreement was made February 20, 1933, by which Penn and Reading guaranteed to Farmers that the assets of each would exceed in value its liabilities assumed by Farmers under the agreement of February 17; and that he acquiesced in the continued administration of the affairs of Penn and Reading by Farmers. On February 17 the assets of Penn which were transferred to Farmers had a reasonable market net value of $5,400,000 as against total liabilities of $5,100,000, and the assets of Farmers were of the fair value of $8,000,000 (to which is to be added the stockholders’ liability for assessment in the amount of $1,000,000), as against liability to creditors of $9,000,000.2 The daims of the two banks against Farmers were, at the date of transfer, and still are, more than sufficient, in the ordinary course of liquidation, to pay ail of their liabilities without the necessity of an assessment of the stockholders. Farmers continued to do business with the combined and commingled assets from February 17 to March 18, 1933. Then the Comptroller appointed a conservator who took possession of ail of the assets. October 10, 1933, the Comptroller, without notice to Penn or Reading, their depositors, creditors, or stockholders, and without a hearing, ruled that the agreements of February 17 and February 20 were without legal effect and directed that the transfer and delivery of the assets, and the assump-tion of liabilities thereunder, should be disregarded; and 2 The bill in No. 124 allégés that on the same day Reading’s assets exceeded in value its liabilities of approximately $9,000,000. 536 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. he attempted to allocate among the three banks the assets theretofore transferred and delivered to Farmers. He ap-pointed the same person he had previously named con-servator for Farmers to be conservator of the other two banks. October 20, 1933, the Comptroller proposed a so-called plan of reorganization of the three banks which provided for the organization of a new national bank, the issue by it of stock and securities, the pledge of some of its assets to secure a loan from Reconstruction Finance Corporation, a sale of the assets in the possession of the conservator of Farmers to the new national bank, and a division of the proceeds on the basis of thirty-five per cent, to Farmers, twenty-five per cent, to Penn, and twenty-five per cent, to Reading. It is charged that this division was arbitrary and was based on a classification adopted from the report of national bank examiners dated April 24, 1933, and not on the financial condition of the banks as of February 17, 1933, the date of the execution of the agreement, transfer of assets, and assumption of liabilities. The conservator of ail three banks, in further-ance of the plan, reconstructed the assets and liabilities of each as of April 24, 1933, made a division thereof amongst the banks, consummated the sale to the new bank, and apportioned the proceeds according to the plan. In so doing, in conformity with the Comptroller’s ruling, he disregarded ail rights and obligations arising from the agreement of February 17, 1933, and disregarded the claim of Penn, in the amount of $5,100,000, and the claim of Reading, in the amount of $9,000,000, against Farmers. The bills charge that this conduct was arbitrary, and that the Comptroller’s ruling respecting the two agreements was beyond the powers conferred upon him by the National Bank Act or other statutory law, was an unlawful assumption of judicial powers not delegated to him by statute, or capable of being so delegated, was in violation of the rights of Penn and Reading, their depositors, other 532 ADAMS v. NAGLE. Opinion of the Court. 537 creditors, and stockholders, and deprived them of their property without due process of law. After consummation of the plan of reorganization the Comptroller certified that each of the three banks was insolvent and, in October and November 1934, appointed a receiver for each of them. January 15, 1935, he certified that, upon a proper accounting by the receivers of Penn and Reading, and a valuation of the uncollected assets remaining in their hands, it appeared that a 100% assess-ment was necessary to pay their debts and he accordingly ordered such an assessment. The bills characterize his conduct as a failure, neglect, and refusai to collect the daims of Penn and Reading against Farmers and a conséquent failure to comply with the conditions and provisions of the statute authorizing assessments of stockholders, and as “in fraud of the rights” of Penn and Reading, their creditors and stockholders. His ignoring the daims is charged to hâve been “a grave error of law based upon his unwarranted assumption of judicial power in abrogating, cancelling, and waiving” the daims of Penn and Reading against Farmers, and “adjudicating the private rights and obligations of parties not subject to his power and control,” which invalidated the assessments. The receiver interposed motions to dismiss which were sustained by the District Court. The Circuit Court of Appeals reversed,3 holding the bills set forth a cause of action since, if their allégations were true, the Comp-troller had exceeded his statutory power and acted arbi-trarily in ordering the assessments. The importance of the question involved and asserted conflict of decision moved us to grant certiorari. The petitioner’s position is that the agreement and transfer of assets to the Farmers did not effect a statutory consolidation; that the Comptroller was, there- 3 §8 F. (2d) 936. 538 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. fore, at liberty to treat ail three banks as separate enti-ties for the purpose of assessing stockholders’ liability and that stockholders may not, by a proceeding in equity, challenge his official findings as to insolvency and neces-sity for an assessment. The respondents say the Comp-troller’s power of assessment is conditioned on a basic or quasi-jurisdictional fact,—that the ordinary resources of a bank hâve been exhausted,—and, if they hâve not been, or are déficient only because of the Comptroller’s unlawful abrogation of and refusai to require collection of a valid claim sufficient to pay the bank’s debts, the assessment is subject to direct attack as in excess of that officer’s statutory power, as arbitrary, capricious, and a déniai of due process of law. We are of opinion that the assessments were not subject to attack or frustration in these proceedings upon the grounds set forth in the bills. 1. The agreements of February 17 and February 20 did not effect a consolidation in conformity with the National Banking Act so as to constitute the existing stockholders of Penn and Reading, together with the stockholders of Farmers, stockholders of a Consolidated bank. The steps requisite to such consolidation were never taken.4 2. When the Comptroller took charge of the banks in question he was bound to deal with them, so far as their assets and liabilities were concerned and in respect of stockholders’ liability, upon the basis that they were three separate associations. This conclusion is unaf-fected by the legality and effectiveness of the agree-ment of February 17, 1933, upon which respondents in-sist.5 At most the agreement substituted a new asset— 4 See U. S. C. Tit. 12, § 33. B Compare City National Bank v. Faller, 52 F. (2d) 870; Wanna-maker v. Edisto National Bank, 62 F. (2d) 696, 699; B. V. Emery & Co. v. Wilkinson, 72 F. (2d) 10, 12. 532 ADAMS v. NAGLE. Opinion of the Court. 539 the promise of Farmers—for the old assets. Respondents do not claim that the contract and the transfer pursuant to it worked a novation whereby the creditors of the transferring banks became creditors of the transférée. So far as the Comptroller was concerned these creditors were still those of the former and entitled to look to their assets for payment. 3. Whether the Comptroller took the view that the contracts and what was done under them were effective to commute the physical assets of Penn and Reading into a chose in action against Farmers, or that the transaction did not so operate but left Penn and Reading owners of their assets so far as they could be identified and segregated, it was not, as respondents suggest, a condition precedent to the validity of his assessment that he should hâve exhausted the assets of Penn and Reading. At the argument the position was taken that the Comptroller was without power to lay an assessment until he had gotten in the avails of ail the ordinary assets of the banks and that the claims of Penn and Reading against Farmers under the contract of February 17 were such ordinary assets. The conclusion is that until the receiver of Penn and Reading had recovered upon the contract and distributed the proceeds the Comptroller was without power to order an assessment. No decision of any court was cited to support this position, but it was sought to maintain it by reference to an amendment of the National Bank Act of June 3, 1864,6 offered and adopted in the Senate. The purpose of this amendment was stated to be to “enable the receiver at any time when-ever it becomes necessary, to enforce the individual lia-bility ; and in case it is not necessary, if the other assets are sufficient, he will not enforce this contingent liabil-ity, which is intended as an ultimate security of the 6 c. 106, 13 Stat. 99. 540 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. creditors of the bank.” We think the adoption of the amendment in the light of the explanation is far from sustaining the respondents’ contention. It has always been recognized that if the assets of a closed national bank are sufficient to answer its liabilities the Comptroller is not to levy an assessment, but to him is confided the détermination of the sufficiency of the assets and, if he concludes they are insufficient, it is not only his right but his duty immediately to invoke the contingent liability of the stockholders. This has been the invariable administrative practice and any other would tend to depreciate the availability and the value of stockholders’ liability. 4. The question remains whether, if the Comptroller’s action arose from mistake of fact or law, the remedy here invoked is appropriate. In establishing the national banking System Congress has invested the Comptroller, an administrative officer, with jurisdiction to appoint a receiver after investigation and a finding that a bank has become insolvent, and to order an assessment up to one hundred per cent, of the par value of the stock against the shareholders to pay creditors’ daims if, upon an investigation, he finds that the assets are insufficient to pay the debts. Plainly these are questions for the exercise of administrative discrétion. The necessity for vesting this power in an administrative officer springs from the desirability of prompt liquidation. It would be intolérable if the Comptroller’s decision could be attacked collaterally in every suit by a receiver against the shareholders to collect the amount of the assessment. It is settled this cannot be done.7 It would be equally intolérable if stockholders as a class could call upon a court to review the Comptroller’s exercise of his discrétion. For a court to entertain a suit for this purpose would be 7 Kennedy v. Gibson, 8 Wall. 498, 505; Casey n. Gaüi, 94 U. S. 673, 681 ; Bushnell v. Leland, 164 U. S. 684. 532 ADAMS v. NAGLE. Opinion of the Court. 541 to render nugatory the functions Congress has confided in the Comptroller. It has often been decided this may not be done.8 The respondents, however, urge, and the bill charges, that the Comptroller, in ruling that the contract of February 17 should be disregarded, and the receiver, in following this ruling, exceeded their statutory powers and acted arbitrarily and may be enjoined from enforcing an assess-ment based on the ruling. The contention rests upon a statement in United States v. Knox, 102 U. S. 425: “Although assessments made by the comptroller, under the circumstances of the first assessment in this case, and ail other assessments, successive or otherwise, not exceed-ing the par value of ail the stock of the bank, are conclusive upon the stockholders, yet if he were to attempt to enforce one made, clearly and palpably, contrary to the views we hâve expressed, it cannot be doubted that a court of equity, if its aid were invoked, would promptly restrain him by injunction.” This was said in a case where a creditor sought a mandamus to compel the Comptroller to order an assessment, he having refused so to do on the ground that the very terms of the statute forbade such action. Relying on this expression a number of the fédéral courts hâve said that, while an assessment may not be collaterally attacked, it may be avoided by direct attack for “clear error of law, fraud, or mistake.”9 Re-spondents admit this statement is too broad. Other courts 8 Liberty National Bank v. Mclntosh, 16 F. (2d) 906; Wanna-maker v. Edisto National Bank, supra; Meeker v. Baxter, 83 F. (2d) 183; Davis Trust Co. v. Hardee, 85 F. (2d) 571; Acker v. Hamilton, 85 F. (2d) 574; Barbour v. Thomas, 86 F. (2d) 510; Church v. Hub-bard, 91 F. (2d) 406. 8 See, e. g., Deweese v. Smith, 106 Fed. 438, 445; B. V. Emery & Co. v. Wilkinson, 72 F. (2d) 10, 12; Trustées v. Picher, 90 F. (2d) 741, 743; United States Nat. Bank v. Pôle, 2 F. Supp. 153, 157; Angeny v. Keuper, 16 F. Supp. 542, 543. 542 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. hâve said that the only ground of successful attack is fraud on the part of the Comptroller.10 This case présents no such basis for relief. The bills do not charge bad faith or fraud on the part of the Comptroller. The averment that his ruling with respect to the contract of February 17 and the conséquent action of the receiver were “in fraud” of the rights of Penn and Reading and their stock-holders falls far short of any charge of actual fraud. In-deed no suggestion of such fraud was advanced by respondents either in brief or in argument. The respondents rely upon decisions holding that a bill in equity or a writ of mandamus will lie to compel an executive officer to comply with the plain mandate of a statute. These hâve no application for they deal with a situation wholly foreign to that here presented. Where a statute vests no discrétion in an executive officer but to act under a given set of circumstances, or forbids his acting except upon certain named conditions, a court will compel him to act or to refrain from acting if he essays wholly to disregard the statutory mandate; but if a discrétion is vested in him, and he is to act in the light of the facts he ascertains and the judgment he forms, a court cannot restrain him from acting on the ground that he has ex-ceeded his jurisdiction by reason of an error either of fact or law which induced his conclusion. Plainly, therefore, the respondents are wrong in asserting that as the facts set forth in their bill charge the Comptroller with an error of law, he exceeded his authority. The respondents further insist that their allégation that the Comptroller’s action was “arbitrary,” which is am-plified and given content by the facts alleged and ad-mitted by the motion to dismiss, requires a decree avoiding the assessment. The epithet “arbitrary,” used in this 10 O’Conner v. Watson, 81 F. (2d) 833, 836; Meeker v. Baxter, 83 F. (2d) 183, 186; Davis Trust Co. n. Hardee, 85 F. (2d) 571, 573; Dunn n. O’Connor, 89 F. (2d) 820, 827. ADAMS v. NAGLE. 543 532 Opinion of the Court. connection, can mean no more than do the other aver-ments that the Comptroller, in reaching his conclusion, “committed grave error of law” in failing to regard the contract of February 17 as effective. It would be arbi-trary, in the proper sense of the term, for an official to act in the teeth of a statute or stubbornly to refuse to act at ail where a statute commands action, but where he essays to exercise the jurisdiction conferred upon him, though his errors may be subject to subséquent correction, they cannot be enjoined as an arbitrary exercise of his authority. To hold otherwise would render orderly administrative procedure impossible. A reference to the situation with which the Comptroller was confronted when his receiver took charge of the banks will serve to demonstrate that a case was presented calling for the exercise of his discrétion. The bill asserts that over a substautial period subséquent to the transfer of Penn’s and Reading’s assets to Farmers these were inter-mingled with Farmers’ assets. It avers that an attempted ségrégation of assets was made upon the basis of a report of bank examiners dated April 24, 1933, more than two months after the transfer; it allégés that, at the date of transfer, Farmers owed $9,000,000 against which it had assets of $8,000,000 and a possible recovery by way of stockholders’ liability of an additional million dollars; it fails to state what the condition of Farmers was when a conservator was appointed for it; what its condition was when a receiver was appointed for it; what its finan-cial status is today. The pleader contents himself with the statement of a conclusion that the “daims” of Penn and Reading against Farmers were, at the time of transfer of their assets, and still are, sufficient in amount to pay ail of those banks’ creditors. But if the allégation is true, the only conclusion to be drawn from it is that in ordering the assessment the Comptroller erroneously esti-mated the value of the banks’ assets. Whatever may be 544 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. thought of the legality of the transfer of assets pursuant to directors’ action on the eve of insolvency, the creditors of Penn and Reading were not bound to look to Farmers and might prefer to look to the assets transferred or to so much of them as could be traced. And there well may hâve been reason for the Comptroller to doubt the legal efficacy of the transfer in the face of creditors’ attack. These and other matters were to be considered by him in arriving at an informed judgment as to the availability and value of the assets of Penn and Reading to answer the claims of their creditors. As an exercise of the discretion-ary power vested in him, the Comptroller’s action must be treated as final and conclusive as to the necessity for an assessment. 5. If the Comptroller’s decision with respect to the contract of February 17 was erroneous as matter of law the stockholders may or may not hâve a remedy. But their remedy is not to attack, or seek to évadé payment of, the assessment. The collection of the assessment cannot be made to await the outcome of litigation of that question. Moreover, if, as they assert, the Comptroller’s judgment is wrong and the assets of Penn and Reading, consisting of their claims under the contract, are sufficient to pay their creditors, the amounts paid pursuant to the assess-ments will be returned to stockholders in final liquidation. Meantime, however, the creditors, the protection of whose interests is the primary object of the statute, will hâve been paid and, as is right, reimbursement of the stockholders will await possible realization upon assets which the Comptroller believes insufficient to satisfy the creditors. The decrees are reversed and the causes remanded with instructions to dismiss the bills. Reversed. Mr. Justice Cardozo took no part in the considération or decision of this case. LINCOLN CO. v. STEWART-WARNER CORP. 545 Counsel for Parties. LINCOLN ENGINEERING CO. v. STEWART-WARNER CORP. CERTIORARI TO THE CIRCUIT COURT OF APPEALS FOR THE SEVENTH CIRCUIT. No. 608. Argued March 10, 1938.—Decided March 28, 1938. 1. Patent No. 1,593,791, July 27, 1926, to Butler, for the combination of a headed nipple, for receiving lubricant, a grease pump and a coupler having a multi-jawed chuck which is closed over the head of the nipple by the pressure of the grease acting on a piston within the tube of the coupler,—held void as claiming more than the applicant invented. P. 548. Assuming that the coupler embraced a patentable improvement in the respect that the jaws of the chuck are actuated by the grease pressure, the chuck form of coupling as well as the headed nipple and grease pump are old in the art and perform no new functions in this combination. 2. The improvement of one part of an old combination gives no right to daim that improvement in combination with other old parts which perform no new function in the combination. Rogers v. Alemite Corp., 298 U. S. 415. P. 549. 91 F. 2d 757, reversed. Certiorari, 302 U. S. 682, to review the affirmance of a decree, 15 F. Supp. 571 ; 16 id. 778, holding the présent petitioner guilty of contributory infringement in selling headed fittings or nipples for lubrication such as are described in the respondent’s patent and which are usa-ble, and intended to be used, in connection with the grease gun and coupler of the patent. Mr. Leonard L. Kalish, with whom Messrs. Delos G. Haynes and Lloyd R. Koenig were on the brief, for petitioner. Mr. Lynn A. Williams for respondent. 53383°—38----------35 546 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. Mr. Justice Roberts delivered the opinion of the Court. The District Court1 and the Circuit Court of Appeals2 hâve held the petitioner guilty of contributory infringe-ment of the Butler Patent No. 1,593,791. We granted certiorari because of alleged conflict with our decision in Rogers v. Alemite Corporation, reported with Bassick Manufacturing Co. v. Hollingshead Co., 298 U. S. 415. Like that in the Rogers case, the patent in suit has to do with apparatus for lubricating bearings, especially those of automobiles, by the use of a nipple or fitting connected with the bearing, a gun consisting of a compressor or pump for propelling the lubricant under high pressure, a hose or conduit to connect the pump with the fitting, and a means of coupling the conduit to the fitting to make a tight joint during the operation of greasing. Both respondent and petitioner market apparatus for pressure lubrication, including fittings and guns. The charge is that the petitioner sells fittings such as are described in the respondent’s patent which are usable, and intended to be used, in connection with the gun and coupler of the patent. What was said in our earlier decision in respect of the prior art need not be repeated. Butler’s alleged invention is in the same field and deals with similar apparatus as did Gullborg’s patent, considered in the Rogers case. As there shown, it was old practice in the lubrication of bearings to use in combination a fitting connected with the bearing through which oil or grease was to be pro-pelled into the bearing, and a gun, which was joined to the fitting by a coupler. In the greasing operation the coupler is fastened to the head of the fitting and the pump is operated to drive the lubricant through the fitting to the bearing. Not only was this combination old but the éléments long used in the art varied in design 115 F. Supp. 571; 16 F. Supp. 778. 291 F. (2d) 757. LINCOLN CO. v. STEWART-WARNER CORP. 547 545 Opinion of the Court. and dimension. Fittings were of different sizes and shapes and had diverse arrangements for their closure when not in actual use for the injection of lubricant. Guns were of many sizes and types. Various forms of coupler had been used for sealing the connection between the pump hose and the fitting. In the Rogers case it appeared that fittings with lugs or pins to be engaged by the coupler were old but that Gullborg had obtained a patent for a new form of pin fitting the novel feature of which was means of automatic closure and opening for admittance of the grease in connection with a pin which passed through the bore of the fitting. This was not the patent there in suit. Gullborg also obtained a patent in which the novel feature of certain claims was a bayonet-slotted coupler so designed as to coôperate with a pin fitting ’ (including one of the type covered by his other patent), to permit the building up of very high pressure and, by its operation upon disengagement, to obviate exudation of grease about the head of the fitting. In other claims Gullborg claimed a combination of a pin fitting, of the type covered by his fitting patent, a pump, a discharge conduit secured to the pump, and a hollow coupling mem-ber of any type (whether old and unpatented or of the improved construction disclosed in the patent) for re-ceiving the closed end of the fitting. In the Rogers case the owner of the patent asserted the sale of any grease gun for use with the patented pin fitting of Gullborg, or the sale of any pin fitting, whether of the Gullborg type or of an old type, susceptible of use with the improved Gullborg coupler, constituted contributory in-fringement of the patent. We held that as the combination of pump, connecting conduit, coupler, and fitting was old, Gullborg could not, by inventing a new and improved type of coupler or fitting claim either of these in combination with the old forms of the other éléments so as to exclude the public from the use and sale of the old 548 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. forms of fittings or grease guns even though these might be used respectively with Gullborg’s improved coupler or his improved pin fittings, because, in the combinations claimed, an old-type pin fitting, or an old-type coupler had no novel function over those of the prior art. We said that if Gullborg had invented anything he had in-vented an improved pin fitting and an improved coupler and that to allow him to claim either in combination with old éléments which performed no new function, would be to permit him to extend the monopoly of his invention to those old and well known devices. With this background we turn to the patent in suit. Like that of Gullborg, the claim is for a combination. It is as follows: “2. The combination with a headed nipple for receiving lubricant, of a lubricant compresser having a coupling member for connecting said compresser and nipple com-prising a cylinder, a piston movable within the cylinder, and having an aperture for the discharge of lubricant thereof, an apertured sealing seat carried by said piston for engagement with the end of the nipple, connecting the piston aperture with a passage through the nipple, radially movable locking éléments carried by the cylinder coacting with the nipple and actuated by said piston for compressively clutching the éléments upon the nipple whereby the pressure of the lubricant on said piston will move the piston to forcibly compress said'éléments while the lubricant is passing through said connecting parts.” In its pétition for certiorari, and in argument upon the merits, the petitioner insisted that the respondent’s commercial form of coupler was not that of the Butler patent; that the Circuit Court of Appeals for the Eighth Circuit had so held,3 and that the courts below erred in not reaching a similar conclusion. In view of the grounds 3 Stewart-Wamer Corp. v. Jifiy Lubricator Co., 81 F. (2d) 786. LINCOLN CO. v. STEWART-WARNER CORP. 549 545 Opinion of the Court. of our decision we find it unnecessary to pass upon this question. The petitioner’s principal contention is that our decision in the Rogers case is controlling.4 We so hold. As has been said, the combination of éléments disclosed is old in the art. As the Circuit Court of Appeals held, a headed nipple or fitting connected with the bearing, and to be coupled to the conduit from the grease gun, is old and unpatentable. A compressor or pump for propelling lu-bricant is old and unpatentable as such. The invention, if any, which Butler made was an improvement in what he styles in his spécifications the “chuck” and in his claim a “coupling member.” It is not denied that multi-jawed chucks had been used in industry and as couplers in lu-bricating apparatus. Butler may hâve devised a patentable improvement in such a chuck in the respect that the multiple jaws in his device are closed over the nipple by the pressure of the grease, but we think he did no more than this. As we said of Gullborg in the Rogers case, having hit upon this improvement he did not patent it as such but attempted to claim it in combination with other old éléments which performed no new function in his claimed combination. The patent is therefore void as claiming more than the applicant invented. The mere aggregation of a number of old parts or éléments which, in the aggregation, perform or produce no new or different function or operation than that theretofore performed or produced by them, is not patentable invention.5 And the improvement of one part of an old combination gives no right to claim that improvement in combination with other old 4 The District Court for Western Pennsylvania has so held : Stew-art-Wamer Corp. v. Rogers, 15 F. Supp. 410; and see Jacques v. Universal Lubricating Systems, 22 F. Supp. 458. 6 Pickering v. McCullough, 104 U. S. 310; Burt v. Evory, 133 U. S. 349; Brinkerhoff v. Aloe, 146 U. S. 515; Office Specialty Mfg. Co. v. Fenton Metallic Mfg. Co., 174 U. S. 492. 550 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. parts which perform no new function in the combination.6 Though the respondent so concédés, it urges that, in the combination of the Butler patent, the headed nipple per-forms a new and different function from that which it has heretofore performed, in other combinations, in that, when the coupler is withdrawn from the nipple, at the end of the greasing operation, the rounded head of the nipple “cocks” the jaws of the coupler for the next operation. The suggestion seems to be an afterthought. No such function of the nipple is hinted at in the spécifications of the patent. If this were so vital an element in the functioning of the apparatus it is strange that ail mention of it was.omitted.7 Moreover, the argument is unsound since the old art includes instances where the head of a nipple or fitting performs a similar function when the aHeald v. Rice, 104 U. S. 737, 754; Underwood v. Gerber, 149 U. S. 224, 227, 229; Deering v. Winona Harvester Works, 155 U. S. 286, 302; Perry v. Co-Operative Foundry Co., 12 Fed. 436, 438; Yale Lock Mjg. Co. v. Berkshire Nat. Bank, 17 Fed. 531, 532, 535; Troy Laundry Machinery Co. v. Bunnell, 27 Fed. 810, 813; Gates Iron-Works v. Fraser, 42 Fed. 49, affirmed 153 U. S. 332; Abbott Machine Co. y. Bonn, 51 Fed. 223, 226; In re McN&ll, 20 App. D. C. 294; In re Ratican* 36 App. D. C. 95; Kursheedt Mjg. Co. v. Naday, 103 Fed. 948; Langan N. Warren Axe & Tool Co., 184 Fed. 720, 721; In re Bliss, 39 App. D. C. 453; Robinson v. Tubular Woven Fabric Co., 248 Fed. 526, 542; Troy Wagon Works Co. v. Ohio Trader Co., 274 Fed. 612, 621; General Electric Co. v. Ohio Brass Co., 277 Fed. 917, 924; Radio Corporation v. Lord, 28 F. (2d) 257, 260; Schiller v. Robertson, 28 F. (2d) 301, 305; Fruehauf Trader Co. v. Highway Trader Co., 54 F. (2d) 691, 709; In re Germantown Trust Co., 57 F. (2d) 365, 366; McGrath Holding Corp. v. AnzeU, 58 F. (2d) 205; Kodél Electric Co. n. Warren Clock Co., 62 F. (2d) 692, 695; Alemite Corp. v. Lubrair Corp., 62 F. (2d) 898, 900; In re Reed, 76 F. (2d) 907, 909. ’ Union Edge Setter Co. v. Keith, 139 U. S. 530, 539 ; Bail & Socket Fastener Co. v. Kraetzer, 150 U. S. 111, 116; MacColl v. Knowles Loom Works, 95 Fed. 982; Kursheedt Mjg. Co. v. Naday, 103 Fed. 948, 950. LINCOLN CO. v. STEWART-WARNER CORP. 551 545 Opinion of the Court. chuck is disengaged from it. The same argument was unavailing in the Rogers case. It was there contended that the pin fitting of the Gullborg patent performed a new function in causing the bénéficiai operation of the coupler at the moment of disengagement. We com-mented upon the matter thus : “The design of the bayonet slots is such that, in uncoupling, the coupling member of the gun will at first be moved slightly forward on the pin fitting thus backing up the perforated washer in the bore of the coupler.” But there, as in the présent case, it was the peculiar and improved mechanism of the coupler which brought about the resuit and not the form of the fitting. We suppose that a headed nipple has always been so headed in order that the jaws of the chuck may slip over the head in the coupling and uncoupling operation. The weakness of the respondent’s position is well illustrated by what developed at argument. When in-terrogated as to how in the claimed combination the function of the nipple could be thought novel in any different sense than the function of the pump, counsel replied that the pump performed a novel function because the pressure it generated forced forward the piston in the coupler and caused the movable jaws to engage the fitting. If this argument is Sound, the respondent may convict every one who sells a grease pump of contributory infringement. The answer is the same as in the case of the headed nipple. The function of a pump has always been to force a fluid or a grease through a conduit. The fact that this function of the pump is utilized in Butler’s improved form of coupler not only to convey the lubricant to the bearing but to operate the jaws of the chuck does not alter the function of the pump. The invention, if any, lies in the improvement in the coupling device alone. The courts below and the respondent rely upon Leeds de Catlin Co. v. Victor Talking Machine Co., 213 U. S. 552 OCTOBER TERM, 1937. Syllabus. 303 U. S. 301, 325. In the Rogers case we held that authority not controlling. Berliner disclosed an entirely novel prin-ciple; he utilized the fiat dise having a smooth bottomed groove with spiral waves in its sides not only to agitate the needle connected to the diaphragm, but, in combination with a swinging arm, to propel the needle length-wise the groove. In his combination, the dise not only performed a new function but performed it in combination with another new element,—the swinging arm which carried the needle. We conclude that Butler’s effort, by the use of a combination claim, to extend the monopoly of his invention of an improved form of chuck or coupler to old parts or éléments having no new function when operated in connection with the coupler renders the claim void. Decree reversed. Mr. Chief Justice Hughes and Mr. Justice Cardozo took no part in the considération or decision of this case. NEW NEGRO ALLIANCE v. SANITARY GROCERY CO.* CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR THE DISTRICT OF COLUMBIA. No. 511. Argued March 2, 3, 1938.—Decided March 28, 1938. An association of Negroes, organized for the mutual improvement of its members and the promotion of civic, educational, benevolent, and charitable enterprises, requested a Grocery Company to adopt a policy of employing Negro clerks, in the course of personnel changes, in certain stores of the company patronized largely by colored people but in which no colored clerks were employed. The request was ignored; whereupon the organization caused a picket, *The opinion herein is reported as amended by Order of April 25, 1938, see 304 U. S. NEW NEGRO ALLIANCE v. GROCERY CO. 553 552 Argument for Petitioners. bearing a placard reading “Do Your Part! Buy Where You Can Work! No Negroes Employed Here!” to patrol in front of one of the stores, on one day, and caused, or threatened to cause, a similar patrol of two other stores. Held: 1. That, within the meaning of the Act of Mar. 23, 1932, § 13; 29 U. S. C., § 113—the “Norris-LaGuardia Act”—there was a “labor dispute” in which the Negro organization and its officers were “persons interested.” P. 559. The fact that the dispute was “racial,” in that it grew from racial discrimination, does not remove the case from the scope of the Act. 2. Under §§ 4 and 7 of the Act, the District Court was without jurisdiction to issue an injunction in the promises, against the Negro organization and its officers at the suit of the Grocery Company. P. 561. 92 F. 2d 510, reversed. Certiorari, 302 U. S. 679, to review the affirmance of a decree enjoining the présent petitioner from picketing, boycotting, etc. the stores of the respondent. The case was decided below on bill and answer. Messrs. Belford V. Lawson, Jr. and Thurman L. Dod-son, with whom Mr. Théodore M. Berry was on the brief, for petitioners. Mr. A. Coulter Wells, with whom Mr. William E. Carey, Jr. was on the brief, for respondent. The court below properly held that the matter in controversy herein was not comprehended by the Labor Disputes Act of March 23, 1932, Green v. Samuelson, 168 Md. 421 ; Beck-Hazard Shoe Corp. n. Johnson, 274 N. Y. Supp. 946. The relationship of employer and employée must exist, or a dispute must grow out of that relationship, before the Labor Disputes Act has application. United Electric Coal Companies v. Rice, 80 F. 2d 1 ; Keith Theatre v. Vachon, 187 A. 692. Petitioners, having admitted the act of picketing the stores of the respondent, were properly enjoined by the 554 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. trial court. Jonas Gloss Co. v. Gloss Bottle Blowers’ Assn., 72 N. J. Eq. 653; Pierce v. Stablemen’s Union, 165 Cal. 70; American Steel Foundries v. Tri-City Central Trades Council, 257 U. S. 184; Elkind & Sons v. Retail Clerks I. Protective Assn., 169 A. 494; Truax v. Corrigan, 257 U. S. 312; Beck v. Teamsters’ Protective Union, 118 Mich. 520. The proposition is well established that a combination looking towards the domination or ruination of the business of another by fraud, violence or coercion is funda-mentally unlawful. Waitr esses Union v. Benish Restaurant Co., 6 F. 2d 568; Kinloch Téléphoné Co. v. Local Union No. 2, 275 F. 241; Quinlivan v. Dail-Overland Co., 274 F. 56. Mr. Justice Roberts delivered the opinion of the Court. The matter in controversy is whether the case made by the pleadings involves or grows out of a labor dispute within the meaning of § 13 of the Norris-La Guardia Act.1 The respondent, by bill filed in the District Court of the District of Columbia, sought an injunction restrain-ing the petitioners and their agents from picketing its stores and engaging in other activities injurious to its business. The petitioners answered, the cause was heard upon bill and answer, and an injunction was awarded. The United States Court of Appeals for the District of Columbia affirmed the decree.2 The importance of the question presented and asserted conflict with the decisions of this and other fédéral courts moved us to grant certiorari. 1 Act of .March 23, 1932, c. 90, 47 Stat. 70, 73, U. S. C. Tit. 29. § H3. 2 67 App. D. C. 359; 92 F. (2d) 510. NEW NEGRO ALLIANCE v. GROCERY CO. 555 552 Opinion of the Court . As the case was heard upon the bill and a verified an-swer the facts upon which decision must rest are those set forth in the bill and admitted or not denied by the answer and those affirmatively set up in the answer. The following facts alleged in the bill are admitted by the answer. Respondent, a Delaware corporation, opérâtes 255 retail grocery, méat, and vegetable stores, a warehouse and a bakery in the District of Columbia and employs both white and colored persons. April 3, 1936, it opened a new store at 1936 Eleventh Street, N. W., installing personnel having an acquaintance with the trade in the vicinity. Petitioner, The New Negro Alliance, is a corporation composed of colored persons, or-ganized for the mutual improvement of its members and the promotion of civic, educational, benevolent, and charitable enterprises. The individual petitioners are officers of the corporation. The relation of employer and employés does not exist between the respondent and the petitioners or any of them. The petitioners are not en-gaged in any business compétitive with that of the respondent, and the officers, members, or représentatives of the Alliance are not engaged in the same business or occupation as the respondent or its employés. As to other matters of fact, the state of the pleadings may be briefly summarized. The bill asserts: the petitioners hâve made arbitrary and summary demands upon the respondent that it engage and employ colored persons in managerial and sales positions in the new store and in various other stores; it is essential to the conduct of the business that respondent employ experienced persons in its stores and compliance with the arbitrary demands of défendants would involve the discharge of white employés and their replacement with colored; it is impérative that respondent be free in the sélection and control of persons employed by it without interférence by the petitioners 556 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. or others; petitioners hâve written respondent letters threatening boycott and ruination of its business and notices that by means of announcements, meetings and advertising the petitioners will circulate statements that respondent is unfair to colored people and to the colored race and, contrary to fact, that respondent does not em-ploy colored persons; respondent has not acceded to these demands. The answer admits the respondent has not acceded to the petitioners’ demands, but déniés the other allégations and states that the Alliance and its agents hâve requested only that respondent, in the regular course of personnel changes in its retail stores, give employment to Negroes as clerks, particularly in stores patronized largely by colored people; that the petitioners hâve not requested the discharge of white employés nor sought action which would involve their discharge. It déniés the making of the threats described and allégés the only représentations threatened by the Alliance or its authorized agents are true représentations that named stores of the respondent do not employ Negroes as sales persons and that the petitioners hâve threatened no more than the use of lawful and peaceable persuasion of members of the community to withhold patronage from particular stores after the respondent’s refusai to acknowledge petitioner’s requests that it adopt a policy of employing Negro clerks in such stores in the regular course of personnel changes. The bill further allégés that the petitioners and their authorized représentatives “hâve unlawfully conspired with each other to picket, patrol, boycott, and ruin the Plaintiff’s business in said stores, and particularly in the store located at 1936 Eleventh Street, Northwest” and, “in an effort to fulfill their threats of coercion and intimidation, actually hâve caused the said store to be picketed or patrolled during hours of business of the plaintiff, by their members, représentatives, officers, agents, servants, NEW NEGRO ALLIANCE v. GROCERY CO. 557 552 Opinion of the Court. and employées” ; the pickets carrying large placards charg-ing respondent with being unfair to Negroes and reading: “Do your Part! Buy Where You Can Work! No Negroes Employed Here!” for the purpose of intimidating and coercing prospective customers from entering the respondent’s store until the respondent accèdes to the petitioners’ demands. “Said défendants, their pickets or patrols or some of them hâve jostled and collided with persons in front of the said store and hâve physically hindered, obstructed, interfered with, delayed, molested, and harassed persons desiring to enter the place of business of the Plaintiff Corporation; said pickets, or some of them, hâve attempted to dissuade and prevent persons from entering plaintiff’s place of business; said défendants, their pickets or patrols are disorderly while picket-ing or patrolling, and attract crowds to gather in front of said. stdre, and encourage the crowds or membOrs thereof to become disorderly, and to harass, and otherwise annoy, interfère with and attempt to dissuade, and to prevent persons from entering the place of business of the plaintiff, the disorder thereby preventing the proper conduct of and operation of the plaintiff’s business. De-fendants hâve threatened to use similar tactics of picket-ing and patrolling as aforesaid in front of the several other stores of the plaintiff.” Four photographs alleged to portray the picketing are annexed as exhibits to the bill. One of them shows a man carrying a sandwich placard on the sidewalk and no one else within the range of the caméra. In another, two children are seen beside the picket; in another, two adults; in the fourth, one adult entering respondent’s store at a distance from the picket and without apparent interférence. The answer déniés ail these allégations save that it admits the petitioners did, during April 4, 1936, and at no other time, cause the store at 1936 Eleventh Street, N. W., to be continuously picketed by a single person carrying a placard exhibiting 558 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. the words quoted by the bill; and the petitioners, prior to the acts complained of in the bill, picketed, or ex-pressed the intention of picketing, two other stores. It admits that the photographs correctly represent the picketing of April 4, 1936. The answer avers the information carried on the placards was true, was not intended to, and did not in fact, intimidate customers; there was no physical obstruction, interférence or harassment of anyone desiring to enter the store; there was no disorderly con-duct, and the picketing did not cause or encourage crowds to gather in front of the store. The bill states: “As evidence of the widespread and concerted action planned by the Défendants herein, they hâve caused to be placed or hâve permitted to ap-pear in the Washington Tribune . . . the foliowing statements . . .” There follow quotations from articles appearing in the newspaper purporting to report meetings of the Alliance and speeches made thereat. There is no statement that the facts reported in the articles are true. The answer déniés that any of the petitioners is con-nected with or exercises any control over the Washington Tribune or caused or permitted that newspaper to publish any article or news item whatsoever or in any way acted in concert with the newspaper in those publications. The bill asserts that petitioners and their représentatives, officers, and agents, unlawfully conspired to picket, boycott, and ruin the respondent’s business in its stores, particularly the store at 1936 Eleventh Street. This is denied by the answer. The bill says that the described conduct of petitioners will continue until respondent compiles with petitioners’ demands ; is and will continue to be dangerous to the life and health of persons on the highway, to property thereon, and to respondent’s employés, its property, and business and will cause respondent irréparable in jury; the petitioners’ acts are unlawful, constitute a conspiracy in NEW NEGRO ALLIANCE v. GROCERY CO. 559 552 Opinion of the Court. restraint of trade, and, if continued, will ruin the respond-ent’s business. The answer déniés these allégations so far as they constitute assertions of fact. The case, then, as it stood for judgment, was this: The petitioners requested the respondent to adopt a policy of employing Negro clerks in certain of its stores in the course of personnel changes; the respondent ignored the request and the petitioners caused one person to patrol in front of one of the respondent’s stores on one day carrying a placard which said: “Do Your Part! Buy Where You Can Work! No Negroes Employed Here!” and caused or threatened a similar patrol of two other stores of respondent. The information borne by the placard was true. The patrolling did not coerce or intimidate respondent’s customers; did not physically obstruct, interfère with, or harass persons desiring to enter the store, the picket acted in an orderly manner, and his conduct did not cause crowds to gather in front of the store. The trial judge was of the view that the laws relating to labor disputes had no application to the case. He entered a decree enjoining the petitioners and their agents and employés from picketing or patrolling any of the respondent’s stores, boycotting or urging others to boycott respondent; restraining them, whether by inducements, threats, intimidation or actual or threatened physical force from hindering any person entering respondent’s places of business, from destroying or damaging or threatening to destroy or damage respondent’s property and from aiding or abetting others in doing any of the prohibited things. The Court of Appeals thought that the dispute was not a labor dispute within the Norris-LaGuardia Act because it did not involve terms and conditions of employaient such as wages, hours, unionization or better-ment of working conditions, and that the trial court, there-fore, had jurisdiction to issue the injunction. We think the conclusion that the dispute was not a labor dispute 560 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. within the meaning of the Act, because it did not involve terms and conditions of employment in the sense of wages, hours, unionization or betterment of working conditions is erroneous. Subsection (a) of § 13 provides: “A case shall be held to involve or to grow ont of a labor dispute when the case involves persons who are engaged in the same industry, trade, craft, or occupation; or hâve direct or indirect interests therein; ... or when the case in volves any con-flicting or competing interests in a ‘labor dispute’ (as hereinafter defined) of ‘persons participating or interested’ therein (as hereinafter defined).” Subsection (b) char-acterizes a person or association as participating or interested in a labor dispute “if relief is sought against him or it and if he or it . . . has a direct or indirect interest therein, . . .” Subsection (c) defines the term “labor dispute” as including “any controversy concerning terms or conditions of employment, . . . regardless of whether or not the disputants stand in the proximate relation of employer and employée.” These définitions plainly em-brace the controversy which gave rise to the instant suit and classify it as one arising out of a dispute defined as a labor dispute. They leave no doubt that The New Negro Alliance and the individual petitioners are, in contemplation of the Act, persons interested in the dispute.3 In quoting the clauses of § 13 we hâve omitted those that deal with disputes between employers and employés and disputes between associations of persons engaged in a particular trade or craft, and employers in the same industry. It is to be noted, however, that the inclusion in the définitions of such disputes, and the persons interested in them, serves to emphasize the fact that the quoted portions were intended to embrace contro- 3 Compare Senn v. Tile Loyers Union, 301 U. S. 468; Lauf v. Shinner & Co., 302 U. S. 323. NEW NEGRO ALLIANCE v. GROCERY CO. 561 552 Opinion of the Court. versies other than those between employers and employés; between labor unions seeking to represent employés and employers; and between persons seeking employment and employers. The Act does not concern itself with the background or the motives of the dispute. The desire for fair and équitable conditions of employment on the part of persons of any race, color, or persuasion, and the removal of discriminations against them by reason of their race or religious beliefs is quite as important to those con-cemed as fairness and equity in terms and conditions of employment can be to trade or craft unions or any form of labor organization or association. Race discrimination by an employer may reasonably be deemed more unfair and less excusable than discrimination against workers on the ground of union affiliation. There is no justification in the apparent purposes or the express terms of the Act for limiting its définition of labor disputes and cases arising therefrom by excluding those which arise with respect to discrimination in terms and conditions of employment based upon différences of race or color. The purpose and policy of the Act respecting the jurisdiction of the fédéral courts is set forth in §§ 4 and 7. The former deprives those courts of jurisdiction to issue an injunction against, inter dlia, giving publicity to the existence of, or the facts involved in, any labor dispute, whether by advertising, speaking, patrolling, or by any other method not involving fraud or violence ; against as-sembling peaceably to act or to organize to act in promotion of interests in a labor dispute; against advising or notifying any person of an intention to do any of the acts specified; against agreeing with other persons to do any of the acts specified.4 Section 7 deprives the 4 U. S. C. Tit. 29, § 104. 53383°—38----------36 562 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. courts of jurisdiction to issue an injunction in any case involving or growing out of a labor dispute, except after hearing sworn testimony in open court in support of the allégations of the complaint, and upon findings of fact to the effect (a) that unlawful acts hâve been threat-ened and will be committed unless restrained, or hâve been committed and will be continued, unless restrained, and then only against the person or persons, association or organization making the threat or permitting the unlawful act or authorizing or ratifying it; (b) that sub-stantial and irréparable injury to complainant’s property will follow; (c) that, as to each item of relief granted, greater in jury will be inflicted upon the com-plainant by déniai of the relief than will be inflicted on the défendant by granting it; (d) that complainant has no adéquate remedy at law, and (e) that the public officers charged with the duty to protect complainant’s property are unable or unwilling to furnish adéquate protection.5 The legislative history of the Act demonstrates that it was the purpose of the Congress further to extend the prohibitions of the Clayton Act® respecting the exercise of jurisdiction by fédéral courts and to obviate the re-sults of the judicial construction of that Act.7 It was intended that peaceful and orderly dissémination of information by those defined as persons interested in a labor dispute concerning “terms and conditions of employment” in an industry or a plant or a place of business should be lawful ; that, short of fraud, breach of the 6 U. S. C. Tit. 29, § 107. 8 Act of Oct. 15, 1914, c. 323, § 20, 38 Stat. 730, 738, U. S. C. Tit. 29, § 52. ''Duplex Printing Press Co. v. Deering, 254 U. S. 443; American Steel Foundries v. Tri-City Central Trades Council, 257 U. S. 184. Compare House Report No. 669, 72nd Cong., lst Sess., and Senate Report 1060, 71st Cong., 2nd Sess., and Senate Report 163, 72nd Cong., lst Sess. NEW NEGRO ALLIANCE v. GROCERY CO. 563 552 McReynolds, J., dissenting. peace, violence, or conduct otherwise unlawful, those hav-ing a direct or indirect interest in such terms and conditions of employment should be at liberty to advertise and disseminate facts and information with respect to terms and conditions of employment, and peacefully to persuade others to concur in their views respecting an em-ployer’s practices.8 The District Court erred in not com-plying with the provisions of the Act. The decree must be reversed and the cause remanded to the District Court for further proceedings in con-formity with this opinion. Reversed. Mr. Justice Cardozo took no part in the considération or decision of this case. Mr. Justice McReynolds, dissenting. Mr. Justice Butler and I cannot accept the view that a “labor dispute” emerges whenever an employer fails to respond to a communication from A, B and C— irrespective of their race, character, réputation, fitness, previous or présent employment—suggesting displeasure because of his choice of employés and their expectation that in the future he will not fail to select men of their complexion. It seems unbelievable that, in ail such circumstances, Congress intended to inhibit courts from extending protection long guaranteed by law and thus, in effect, encourage mobbish interférence with the individual’s liberty of action. Under the tortured meaning now attributed to the words “labor dispute,” no employer—merchant, manufacturer, builder, cobbler, housekeeper or what not—who 8 Compare Senn v. Tile Loyers Union, 301 U. S. 468; Levering & Garrigues Co. v. Morrin, 71 F. (2d) 284; Cinderella Theatre Co. v. Sign Writers’ Local, 6 F. Supp. 164; Miller Fumiture Co. v. Fumiture Workers Union, 8 F. Supp. 209. 564 OCTOBER TERM, 1937. Counsel for Parties. 303 U. S. prefers helpers of one color or class can find adéquate safe-guard against intolérable violations of his freedom if members of some other class, religion, race or color de-mand that he give them precedence.* Design thus to promote strife, encourage trespass and stimulate intimidation, ought not to be admitted where, as here, not plainly avowed. The ultimate resuit of the view now approved to the very people whom présent peti-tioners claim to represent, it may be, is prefigured by the grievous plight of minorities in lands where the law has become a mere political instrument. UNITED STATES v. HENDLER, TRANSFEREE. CERTIORARI TO THE CIRCUIT COURT OF APPEALS FOR THE FOURTH CIRCUIT. No. 563. Argued March 9, 1938.—Decided March 28, 1938. A gain resulting to a corporation from the assumption and payment of its bonded indebtedness by another corporation, with which it merged, held not exempt from income tax under Revenue Act of 1928, § 112. P. 567. 91 F. 2d 680, reversed. Certiorari, 302 U. S. 680, to review the affirmance of a judgment in favor of the taxpayer, 17 F. Supp. 558, in a suit to recover an alleged overpayment of income taxes. Mr. J. Louis Monarch, with whom Acting Solicitor General Bell, Assistant Attorney General Morris and Mr. Arnold Raum were on the brief, for the United States. * See—définition of Dispute, Webster’s New International Diction-ary; 29 U. S. C., § 113 (c); Senate Report No. 163, 72nd Congress, Ist Session, pp. 7, 11, 25; House Report No. 669, 72nd Congress, Ist Session, pp. 3, 7, 8, 10, 11. UNITED STATES v. HENDLER. 565 564 Opinion of the Court. Messrs. William R. Semans and Randolph Barton, Jr. for respondent. Mr. Justice Black delivered the opinion of the Court. The Revenue Act of 19281 imposed a tax upon the annual “net income” of corporations. It defined “net income” as “gross income . . . less the déductions al-lowed . . . ,” and “gross income” as including “gains, profits and income derived from . . . trades ... or sales, or dealings in property, ... or gains or profits and income . . . from any source whatever.” 2 Section 112 of the Act3 exempts certain gains which are realized from a “reorganization” similar to, or in the nature of, a corporate merger or consolidation. Under this section, such gains are not taxed if one corporation, pursuant to a “plan of reorganization” exchanges its property “solely for stock or securities, in another corporation a party to the reorganization.” But, when a corporation not only receives “stock or securities” in exchange for its property, but also receives “other property or money” in carrying out a “plan of reorganization,” “(1) If the corporation receiving such other property or money distributes it in pursuance of the plan of reorganization, no gain to the corporation shall be recognized from the exchange, but “(2) If the corporation receiving such other property or money does not distribute it in pursuance of the plan of reorganization, the gain, if any, to the corporation shall be recognized [taxed] . . .” In this case, there was a merger or “reorganization” of the Borden Company and the Hendler Creamery Company, Inc., resulting in gains of more than six million dollars to the Hendler Company, Inc., a corporation of 1 Revenue Act of 1928, c. 852, 45 Stat. 791, § 13. 2 Id., §§ 21-22. 3 Id., § 112. 566 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. which respondent is transférée. The Court of Appeals, believing there was an exemption under § 112, affirmed4 the judgment of the District Court5 holding ail Hendler gains non-taxable. This controversy between the government and respondent involves the assumption and payment—pursuant to the plan of reorganization—by the Borden Company of $534,297.40 bonded indebtedness of the Hendler Creamery Co., Inc. We are unable to agréé with the conclusion reached by the courts below that the gain to the Hendler Company, realized by the Borden Company’s payment, was exempt from taxation under § 112. It was contended below and it is urged here that since the Hendler Company did not actually receive the money with which the Borden Company discharged the former’s indebtedness, the Hendler Company’s gain of $534,297.40 is not taxable. The transaction, however, under which the Borden Company assumed and paid the debt and obligation of the Hendler Company is to be regarded in substance as though the $534,297.40 had been paid directly to the Hendler Company. The Hendler Company was the beneficiary of the discharge of its indebtedness. Its gain was as real and substantial as if the money had been paid it and then paid over by it to its creditors. The discharge of liability by the payment of the Hendler Company’s indebtedness constituted income to the Hendler Company and is to be treated as such.6 Section 112 provides no exemption for gains—resulting from corporate “reorganization”—neither received as “stocks or securities,” nor received as “money or other property” and distributed to stockholders under the plan of reorganization. In Minnesota Tea Co. v. Helvering, 4 91 F. (2d) 680. 617 F. Supp. 558. 6 Old Colony Trust Co. v. Commissioner, 279 U. S. 716, 729 Douglas v. Willcuts, 296 U. S. 1, 8, 9. BATES MFG. CO. v. UNITED STATES. 567 564 Syllabus. 302 U. S. 609, it was said that this exemption “contemplâtes a distribution to stockholders, and not payment to creditors.” The very statute upon which the taxpayer relies provides that “If the corporation receiving such other property or money does not distribute it in pur-suance of the plan of reorganization, the gain, if any, to the corporation shall be recognized [taxed] . . Since this gain or income of $534,297.40 of the Hendler Company was neither received as “stock or securities” nor distributed to its stockholders “in pursuance of the plan of reorganization” it was not exempt and is taxable gain as defined in the 1928 Act. This $534,297.40 gain to the taxpayer does not fall within the exemptions of § 112, and the judgment of the court below is Reversed. Mr. Justice Cardozo and Mr. Justice Reed took no part in the considération or decision of this case. BATES MANUFACTURING CO. v. UNITED STATES. CERTIORARI TO THE CIRCUIT COURT OF APPEALS FOR THE FIRST CIRCUIT. No. 647. Argued March 11, 1938.—Decided March 28, 1938. Where, in a suit against the United States in the District Court under the Tucker Act, for recovery of taxes alleged to hâve been illegally collected, the verified pétition of plaintiff was filed within two years after the disallowance of the claim for refund; and within four days after the filing of the pétition, though not within two years after the disallowance of the claim for refund, copies of the pétition were served on the United States Attorney and mailed to the Attorney General,—held the suit was “begun” in time under Revenue Act of 1926, § 1113. P. 572. 93 F. 2d 721, reversed. 568 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. Certiorari, post, p. 628, to review a judgment affirm-ing the dismissal, 19 F. Supp. 526, of a suit to recover an alleged overpayment of taxes. Mr. Charles B. Rugg, with whom Messrs. H. Brian Holland and Warren F. Farr were on the brief, for petitioner. Mr. Norman D. Keller, with whom Solidtor General Jackson, Assistant Attorney General Morris, and Messrs. Sewall Key and F. E. Youngman were on the brief, for the United States. By leave of Court, Messrs. Théodore B. Benson and John Jennings, Jr. filed a brief on behalf of Finnacle Mills, as amicus curiae, in support of petitioner. Mr. Justice Black delivered the opinion of the Court. The Revenue Act of 19261 provides that “No suit . . . shall be maintained in any court for the recovery of any internal-revenue tax alleged to hâve been erroneously or illegally assessed or collected, . . . unless such suit . . . is begun within two years after the disallowance of . . . such claim . . .” The Tucker Act of March 3, 18872 as amended, gives concurrent jurisdiction to the District Courts and the Court of Claims in suits against the United States in-cluding those for recovery of erroneous or illegally collected taxes.3 Section 5 of the Tucker Act requires a plaintiff bringing suit against the government in the District Court to “file a pétition, duly verified with the clerk of the respective court having jurisdiction of the case.” Section 6 requires “that the plaintiff . . . cause 1 c. 27, 44 Stat. 9, § 1113. 3 c. 359, 24 Stat. 505, 506. 8 U. S. C. Title 28, § 41 (20), (Judicial Code § 24 (20) as amended). BATES MFG. CO. v. UNITED STATES. 569 567 Opinion of the Court. a copy of his pétition . . . to be served upon the district attorney . . and . . . mail a copy . . . to the Attorney General . . ., and cause to be filed with the clerk of the court . . . affidavit of such service and . . . mailing . . .” March 22, 1927, the petitioner’s claim for tax refund was disallowed. March 21, 1929, within two years after the disallowance, a duly verified pétition was filed in the District Court claiming the refund. March 25, 1929, two years and four days after the disallowance, the pétition was served on the United States Attorney and mailed to the Attorney General. The District Court held suit was not “begun” by filing the verified pétition and dismissed the cause of action.4 The Court of Appeals affirmed.6 It is conceded that suit in the Court of Claims is “begun” when the pétition is filed. Yet, it is insisted that suit is not “begun” in the District Court when the pétition is filed although the Court of Claims and the District Courts are given concurrent jurisdiction by the Tucker Act. Considération of the history and language of the statute leads us to a different conclusion. Section 10 of the Act of March 3, 1863,6 provides “That every claim against the United States, cognizable by the Court of Claims, shall be forever barred unless the pétition setting forth a statement of the claim be filed .. . within six years after the claim first accrues . . .” When the Tucker Act in 1887 greatly expanded the jurisdiction of the Court of Claims and gave District Courts concurrent jurisdiction in ail cases involving cer 419 F. Supp. 526. 6 93 F. (2d) 721. 812 Stat. 765, 767. 570 * OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. tain amounts, its limitation in both the Court of Claims and the District Courts provided: “. . . no suit against the Government of the United States, shall be allowed under this act unless the same shall hâve been brought within six years after the right accrued . . .” The substantial rights of claimants are to be governed alike whether suit is brought in the Court of Claims or the District Court. The author of the Tucker Act in declaring the statute of limitations applicable alike “to any or ail” of the cases arising under the Act drew no distinction between suits brought in the District Court and in the Court of Claims.7 The purpose of giving the District Courts concurrent jurisdiction with the Court of Claims was to provide ad-ditional opportunity for the considération and détermination of claims that had “long pressed upon the considération of Congress”8 and to permit suit to “be brought in the District where the parties résidé.” 9 After discussing the benefits of previous législation creating and extend-ing the jurisdiction of the Court of Claims, the Commit-tee on the Judiciary reported to the House: “The history of this législation and its results hâve been given to show how much of benefit has been done in the satisfactory decisions of claims against the Government and in relief of the Congress. But it has long been felt that the benefits could be made much greater by extending the jurisdiction of the Court. ... It is need-less to say more than has already been intimated as to the general policy of this législation. The large mass of ’ Congressional Record and Appendix, 49th Cong., 2nd Sess., March 3, p. 2679. 8 House Report No. 1077, 49th Cong., Ist Sess., by Mr. Tucker on the Tucker Bill. 8 Congressional Record and Appendix, 49th Cong., 2nd Sess., March 3, p. 2679. BATES MFG. CO. v. UNITED STATES. 571 567 Opinion of the Court. business now before Congress growing ont of private claims consumes its time year after year in committee work, rendered useless by the lack of time to consider and pass upon them. Just claims are painfully deferred without interest, and the crédit of the Government, so strictly upheld upon its bonded debt, is justly censured in respect to its honest private claims.”10 In response to the needs disclosed by this report Congress passed the Tucker Act, manifestly intending to provide adéquate opportunity for expeditious and orderly détermination of claims against the Government. This Act not only expanded the jurisdiction of the Court of Claims, but, for the first time, gave District Courts general authority to hear and détermine claims against the Government. Relief of existing claim congestion and prévention of future congestion obviously demanded an integrated jurisdictional plan by which the Court of Claims and District Courts could afford equal opportu-nities for expeditious and fair trials of like claims within the jurisdictional amount of the District Courts. The érection of barriers to recovery in the District Courts which did not exist in the Court of Claims would hâve tended to defeat the prime objectives of the Act. Uni-formity and equality in substantial rights and privilèges— for claimants in both forums—were essential features in the System. Distinctions between the opportunities for recovery afforded in the two forums would hâve tended to mar the symmetry of the plan and to impair its effective and successful operation. As to substantial rights, Congress evidently meant to give claimants an identical status in both Courts where the amount in controversy was included in the jurisdiction of both. We find no support in the background or objective of the Act for a “ House Rep. No. 1077, supra, pp. 3-4. 572 OCTOBER TERM, 1937. Opinion of the Court 303 U. S. construction under which a claimant’s rights would be preserved by filing a pétition in the Court of Claims, but would be lost—without additional action—in the District Court. As said by this Court in United States v. Greathouse, 166 U. S. 601, 606: “ . . . it was not contemplated that the limitation upon suits against the Government in the District . . . Courts of the United States should be different from that applicable to like suits in the Court of Claims.” As used in this statute the word “begun” should be given its ordinary and accustomed meaning. To begin is to start; to institute; to initiate; to commence. This suit was begun—within two years after the refund claim was disallowed—when the pétition was filed in court in good faith. Notice was mailed the Attorney General and the District Attorney was promptly served—both within four days after the verified pétition was filed. Under these circumstances, we do not consider what would be the effect of lack of diligence in obtaining service.11 The judgment in the court below was not in harmony with the views here expressed and is Reversed. Mr. Justice Cardozo and Mr. Justice Reed took no part in the considération or decision of this case. 11 Compare, Linn & Lane Timber Co. v. United States, 236 U. S. 574, 578. RAPID TRANSIT CORP. v. NEW YORK. 573 Syllabus. NEW YORK RAPID TRANSIT CORP. v. CITY OF NEW YORK.* APPEAL FROM THE SUPREME COURT OF NEW YORK. No. 435. Argued February 7, 1938.—Decided March 28, 1938. 1. Since carriers or other utilities with the right of eminent domain, the use of public property, spécial franchises or public contracts, hâve many points of distinction from other businesses, including relative freedom from compétition, they may for purposes of taxation be classed separately. P. 578. 2. Utilities subject to supervision by the New York Department of Public Service—including those engaged in transportation of persons or property, and those furnishing gas, electricity, steam, water, communication by telegraph or téléphoné—were subjected by local laws of the City of New York to privilège taxes of 3% of their gross incomes. The laws were enacted for short periods under authority from the state législature, and the proceeds were ear-marked for use exclusively in relieving the unemployed in the city. Transit companies operating in the city assailed the levies under the due process and equal protection clauses of the Fourteenth Amendment, and the contract clause, of the Fédéral Constitution. Held: (1) It is not a valid objection that the taxpayers are defined by référencé to the classification previously established by the New York Public Service Law rather than by spécifie reference in the taxing law itself to the character of their businesses. P. 579. (2) Separate classification of the utilities taxed is justifiable, upon the grounds that they enjoy a spécial measure of statutory protection from compétition; that they are required to make financial reports to public authority which are of administrative convenience in ascertaining and collecting such taxes; and that the revenues of such utilities, furnishing indispensable services, may be subject to relatively little fluctuation, even in times of dépression. P. 580. (3) The facts that the transit companies hâve a low margin of net income, and that because of contracts with the city they can not pass-on the added tax burden by increasing their charges, are fortuitous and do not render the taxes arbitrary and unreasonably * Together with No. 436, Brooklyn & Queens Transit Corp. v. City of New York, also on appeal from the Suprême Court of New York. 574 OCTOBER TERM, 1937. Syllabus. 303 U. S. discriminatory against them as compared with the other utilities or with business in general. P. 581. The législature is not required to make meticulous adjustments in an effort to avoid incidental hardships. (4) Taxes on gross receipts, rather than on net income, are justified upon the ground of convenience in administration and because of 'the close relation of the volume of transactions in a business to cost of its supervision and protection by government. Stewart Dry Goods Co. v. Lewis, 294 U. S. 550, distinguished. P. 582. (5) The fact that the tax is levied for the spécifie purpose of relieving conditions (unemployment) to which the utilities taxed bear no spécial relation, does not render it unconstitutional. P. 584. (6) Within the meaning of the rule that classification must rest upon some ground of différence having a fair and substantial relation to the object of the législation, the ‘object’ in this case is the raising of the revenue. That an appropriation of the funds for relief is part of the same législation is not significant; it is not constitutionally necessary that the classification for the tax be re-lated to the appropriation of the proceeds. P. 585. (7) The laws under considération do not violate the due process clause of the Fourteenth Amendment. P. 587. 3. To sustain a claim of contractual tax exemption the language must be clear and express. P. 593. 4. In deciding a case under the contract clause, this Court détermines for itself the existence and meaning of the contract; but, in so doing, it leans toward agreement with the courts of the State and accepts their judgment unless manifestly wrong. P. 593. 5. In a contract between the City of New York and a transit corporation, the city agreed to construct certain railroads and the company to contribute to their cost and equipment and to re-construct and build additions to its own railroads. The city leased the railroads it agreed to construct to the company and the company agreed to operate them, in conjunction with its own as one System, for a designated fare. The gross receipts were to be pooled; déductions were to be made, in their order, first to reim-burse the company for specified expenses and outlays, including taxes, and then to reimburse the city for certain interest and amortization charges; and the remainder was to be divided equally between the city and the company. The tax déduction included “ail taxes . . . of every description (whether on physical property, stock or securities, corporate or other franchises, or otherwise) RAPID TRANSIT CORP. v. NEW YORK. 575 573 Opinion of the Court. assessed or which may hereafter be assessed against the Lessee in connection with . . . the operation of the . . . Railroads.” At the time of making the contract, the taxing power of the city was con-fined to spécial assessments for public improvements and ad valorem taxes on real estate and on spécial franchises granted by the city. Later, under new power acquired from the législature, the city levied a privilège tax of 3% of the gross receipts. Held: (1) That the collection of such tax was not in violation of the contract but in accordance with its express terms. Pp. 588, 591. (2) The contract may not be construed as limiting the taxes déductible from gross receipts to those which the city was authorized to impose when the contract was made. P. 591. 275 N. Y. 258, 454 ; 9 N. E. 2d 858; 11 id. 293, affirmed. Appeals from judgments of the Suprême Court of New York, entered on remittitur from the Court of Appeals. These were actions to recover from the city large sums exacted as taxes. The Spécial Term of the Suprême Court held the taxes void; the Appellate Division affirmed, 251 App. Div. 710; 296 N. Y. S. 1006, 1012; the Court of Appeals upheld the taxes and reversed the judgments. Messrs. Harold L. Warner and Paul D. Miller, with whom Messrs. George D. Y eomans, Andrew M. Williams, and Arthur A. Baïlantine were on the briefs, for appellants. Mr. Paxton Blair, with whom Messrs. William C. Chanler, Oscar S. Cox, and Sol Charles Levine were on the briefs, for appellee. Mr. Justice Reed delivered the opinion of the Court. The question for decision is the constitutional validity of Local Laws of the City of New York (Local Law No. 21 of 1934, as amended by Local Law No. 2 of 1935, and extended by Local Law No. 30 of 1935) which provide, § 2, that “for the privilège of exercising its franchise or franchises, or of holding property, or of doing business in 576 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. the City of New York” an excise tax shall be paid by every “utility” doing business in the City of New York during 1935 and the first six months of 1936. “Utility” is defined, § 1 (e), to include “any person subject to the supervision of either division of the depart-ment of public service,” and every person, whether or not subject to such supervision, engaged “in the business of furnishing or selling to other persons, gas, electricity, steam, water, réfrigération, telephony and/or telegraphy” or service in these commodities. Each utility is required to pay a tax “equal to three percentum of its gross income” received during the effective period of the Local Laws, with a minor variation not here assailed for utilities not subject to the specified supervision.1 The Local Laws specify that ail revenues from the tax “shall be deposited in a separate bank account or accounts, and shall be avail-able and used solely and exclusively for the purpose of relieving the people of the City of New York from the hardships and suffering caused by unemployment” (§ 14). The Local Laws, admittedly passed under authority granted by the state législature,2 are assailed under the United States Constitution. For convenience we shall discuss the contentions of the New York Rapid Transit Corporation alone, as détermination of the objections 1 Utilities subject to the supervision of the department of public service pay three per cent, of their “gross income,” as defined by § 1 (c) ; the other utilities pay three per cent, of their “gross operating income,” as defined by § 1 (d). 2 N. Y. Laws 1934, c. 873, authorized any city of a million inhabitants to impose for purposes of unemployment relief any tax within the powers of the state législature, including a tax on gross income or gross receipts of those doing business in the city. The act specifically provided (§2) that the revenues shall be deposited in a separate bank account and used solely for the relief purposes. The authority granted by this statute expired December 31, 1935, but was extended, with certain restrictions not material here, until July 1, 1936, by N. Y. Laws 1935, c. 601. RAPID TRANSIT CORP. v. NEW YORK. 577 573 Opinion of the Court. raised by it is conclusive of those advanced by the Brooklyn and Queens Transit Corporation. The New York Rapid Transit Corporation opérâtes rapid transit railroads in the City of New York under a contract known as Contract No. 4, dated March 19, 1913, made pursuant to the New York Rapid Transit Act, Laws 1891, c. 4, as amended, between its predecessor (New York Municipal Railway Corporation) and the City. As a common carrier engaged in the operation of rapid transit railroads, the corporation is under the supervision of the transit commission, the head of the metropolitan division of the state department of public service. Accordingly, but under protest, it paid the taxes imposed by the Local Laws set out above, for the months January, 1935, to June, 1936, inclusive. It brought this action against the City of New York to recover the amounts paid, $1,408,697, with interest, on the ground that the Local Laws are uncon-stitutional. The case arises on the City’s motion to dismiss the complaint. The Suprême Court of New York, Spécial Term, denied the motion to dismiss the complaint and found that the Local Laws denied equal protection because of gross in-equality of burden in comparison with other utilities. This order was affirmed by the Appellate Division of the Suprême Court, without opinion, on a 3-2 vote (251 App. Div. 710; 296 N. Y. S. 1006). The Court of Appeals reversed (275 N. Y. 258; 9 N. E. 2d 858), upheld the Local Laws against ail attacks, and ruled that the complaint did not state a cause of action. Appeal was taken to this Court under § 237 (a) of the Judicial Code, 28 U. S. C. § 344 (a). The Corporation challenges the Local Laws as violative of the equal protection and due process clauses of the 14th Amendment and the contracta clause of Article I, § 10, of the Constitution. 53383°—38----------37 578 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. I. Classification. No question is or could be made by the Corporation as to the right of a state, or a munici-pality with property delegated powers, to enact laws or ordinances, based on reasonable classification of the ob-jects of the législation or of the persons whom it affects. “Equal protection” does not prohibit this. Although the wide discrétion as to classification retained by a législature, often results in narrow distinctions, these distinctions, if reasonably related to the object of the législation, are sufficient to justify the classification. German Alliance Ins. Co. v. Lewis, 233 U. S. 389, 418; Atchison, T. & S. F. R. Co. v. Matthews, 174 U. S. 96, 105 ; Giozza v. Tiernan, 148 Ü. S. 657. Indeed, it has long been the law under the 14th Amendment that “a distinction in législation is not arbitrary, if any state of facts reasonably can be conceived that would sustain it, . . Rast v. Van Deman & Lewis Co., 240 U. S. 342, 357 ; Borderis Co. v. Baldwin, 293 U. S. 194, 209; Metropolitan Casualty Ins. Co. v. Brownell, 294 U. S. 580, 584. “The rule of equality permits many practical inequalities.” Magoun v. Illinois Trust & Savings Bank, 170 U. S. 283, 296; Breedlove v. Suttles, 302 U. S. 277, 281; Carmichael v. Southern Coal & Coke Co., 301 U. S. 495, 509. “What satisfies this equality has not been and probably never can be precisely defined.” Magoun v. Illinois Trust & Savings Bank, supra, 293. The power to make distinctions exists with full vigor in the field of taxation, where no “iron rule” of equality has ever been enforced upon the States. Bell’s Gap R. Co. v. Pennsylvania, 134 U. S. 232, 237; Giozza v. Tiernan, 148 U. S. 657, 662. A state may exercise a wide discrétion in selecting the subjects of taxation {Magoun N. Illinois Trust & Savings Bank, 170 U. S. 283, 294: Quong Wing n. Kirkendall, 223 U. S. 59, 62; Heisler v. Thomas Coïliery Co., 260 U. S. 245, 255) “particularty RAPID TRANSIT CORP. v. NEW YORK. 579 573 Opinion of the Court. as respects occupation taxes,” Oliver Iron Mining Co. v. Lord, 262 U. S. 172, 179; Brown-Forman Co. v. Kentucky, 217 U. S. 563, 573; Southwestern Oil Co. N. Texas, 217 U. S. 114, 121, 126; see Ohio Oil Co. v. Conway, 281 U. S. 146, 159. Since carriers or other utilities with the right of emi-nent domain, the use of public property, spécial franchises or public contracts, hâve many points of distinction from other businesses, including relative freedom from compétition, especially significant with increasing density of population and municipal expansion, these public service organizations hâve no valid ground by virtue of the equal protection clause to object to separate treatment related to such distinctions. Carriers may be treated as a separate class (compare Seaboard Air Line v. Seegers, 207 U. S. 73) and, as such, taxed differently or additionally. Southern R. Co. v. Watts, 260 U. S. 519, 530. This Court has approved the adoption of modes and methods of assessment and administration peculiar to railroads (Kentucky Railroad Tax Cases, 115 U. S. 321, 337), and upheld tax rates for railroads differing from those on other property, and as between railroad tax-payers, Michigan Central R. Co. v. Powers, 201 U. S. 245, 300; Ohio Tax Cases, 232 U. S. 576, 590; Colum-bus & G. Ry. Co. v. Miller, 283 U. S. 96. Similarly, we hâve explicitly recognized that a State may subject public service corporations to a spécial or higher income tax than individuals or other corporations. Atlantic Coast Line R. Co. v. Daughton, 262 U. S. 413, 424. The Corporation concédés this general right to set apart the utilities in New York for taxation. The Corporation is brought within the purview of the Local Laws because “utility” is defined to include those “subject to the supervision of the department of public service.” § 1 (e). It contends that classification in an 580 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. excise tax, however, should be made by spécifie reference to the character of the business to be taxed, and that it is arbitrary to make taxability dépend on whether a person is subject to the supervision of a commission. Valid reason for the définition utilized appears from the fact that the Local Laws merely adopted the classification previously established in the New York Public Service Law (N. Y. Laws 1910, c. 480, as amended) which had selected those offering several kinds of public services, including the transportation of persons and property (§ 25),3 and made them subject to the supervision of the department of public service. Several reasons may be suggested for the sélection for spécial tax burdens of the utilities embraced by the Local Laws under discussion. We mention a few. Those subject to the supervision of the department of public service are assured by statute that new private enterprises may not enter into direct compétition without a showing of convenience and necessity for the public service4 (see New York Steam Corp. v. City of New York, 268 N. Y. 137, 147; 197 N. E. 172). The Corporation suggests that the statute does not curb compétition from the City’s own rapid transit lines and from taxicabs. Freedom from unlimited, direct, private compétition is of itself a suffi-cient advantage over ordinary businesses to warrant the imposition of a heavier tax burden. Reports which must be filed with the department of public service on the basis of approved Systems of accounting suggest an administrative convenience in the collection and vérification of the 3Others are the production and/or furnishing of gas, electricity, steam, and water, communication by telegraph or téléphoné, omnibus transportation. New York Public Service Law, §§ 64, 78, 89-a, 90, 60. 4 New York Public Service Law (Laws 1910, c. 480), as amended: § 53 (railroad; Street railroad); § 63-d (omnibus); § 68 (gas; electricity); § 81 (steam); § 89-e (water); § 99 (1) (téléphoné and telegraph). RAPID TRANSIT CORP. v. NEW YORK. 581 573 Opinion of the Court. tax 5 which might properly hâve been taken into account by the City’s législature. See Carmichael v. Southern Coal & Coke Co., 301 U. S. 495, 511, and cases cited. The législature may reasonably hâve conceived that the revenues of utilities fumishing indispensable services are subject to relatively little fluctuation, even in dépréssion times, and reasonably hâve shaped its tax System accord-ingly. II. Discrimination. The Corporation urges here, as the lower state courts held, that these general principles of classification are not effective to validate législation where, as in these Local Laws, arbitrary, unreasonable and hostile discrimination against certain railroad companies is shown. This unlawful discrimination appears, because “they are,” as the Corporation sees it, “in a far poorer position to bear the burden of unemployment relief than is business in general.” Business may pass on taxes. Other utilities may apply to the commission and perhaps to the courts for an adéquate rate increase. This Corporation cannot do so as by Contract No. 4 with the City it is bound to furnish transportation for a five-cent fare, which by City Charter provision cannot be changed without the approval of the proposai by a majority of the qualified voters, on referendum.6 It is alleged in the complaint that rapid transit corporations are less able to pay a gross receipts tax than other utilities, whose 5 Operating revenues are reported by railroads. See, e. g., Transit Commission, Summary of Reports of Rapid Transit, Street Surface Railway and Bus Companies operating in the City of New York for the Quarter April-June, 1935, and for the Fiscal Year Ended June 30, 1935; Id., Quarter, April-June, 1936, and for the Fiscal Year Ended June 30, 1936. 8 City of New York, Local Law No. 16 of 1925. The argument is applicable in No. 436. There the limitation on fare exists in a franchise, alleged in the complaint to be beyond the regulatory power of the transit commission. 582 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. gross incbme yields a higher percentage of profit, that the operation and maintenance expenses of these corporations are higher in relation to gross receipts than those of other utilities, the ratio of net income to gross receipts, lower. It is said to be highly discriminatory to classify these railroads apart from other businesses, or in the same group as other utilities. The différences from business are not enough and from other utilities too great to justify this attempted classification, which sets them apart from business as a whole, and yokes them with other utilities. The disadvantages complained of, as to fare limitations, are applicable only to the Corporation, a single member of a class of utilities. It is quite fortuitous that this particular corporation must seek adjustments in fare in a peculiar way. “The législature is not required to make meticulous adjustments in an effort to avoid inci-dental hardships,” see Great Atlantic & Pac. Tea Co. v. Grosjean, 301 U. S. 412, 424. “If the accidents of trade lead to inequality or hardship, the conséquences must be accepted as inhérent in govemment by law instead of govemment by edict.” Fox v. Standard Oil Co., 294 U. S. 87, 102. In comparing its burdens with those of other utilities, the Corporation, by its argument, suggests that a gross receipts tax is invalid while a net income tax is valid. In taxing utilities as a class the législature is not required to make “meticulous adjustments” for a particular sub-class of utility, see Great Atlantic & Pac. Tea Co. n. Grosjean, 301 U. S. at 424, supra. Moreover, while taxation of net income is apportioned to ability to pay, and is there-fore “an équitable method of distributing the burdens of govemment,” see New York ex rel. Cohn v. Graves, 300 U. S. 308, 313, it is not a compulsory method. There are other justifications for the gross receipts tax. Unconcerned RAPID TRANSIT CORP. v. NEW YORK. 583 573 Opinion of the Court. with disputes about permissible déductions, it has greater certitude and facility of administration than the net income tax, an important considération to taxpayer and tax gatherer alike. And the volume of transactions in-dicated on the taxpayer’s books may bear a doser relation to the cost of governmental supervision and protection than the annual profit and loss statement. In Clark v. Titusville, 184 U. S. 329, we rejected an equal protection objection to a license tax on merchants, which we said (p. 334) was “a tax on the privilège of doing business regulated by the amount of sales, and . . . not répugnant to the Constitution of the United States.” And we hâve heretofore had occasion to remark that gross receipts from an occupation constitutes an “appropriate measure of the privilège” of engaging in that occupation, Western Live Stock N. Bureau of Revenue, 303 U. S. 250; American Manufacturing Co. v. St. Louis, 250 U. S. 459, 463; Maine v. Grand Trunk Ry. Co., 142 U. S. 217, 228. Reliance is placed upon certain language of the opinion in Stewart Dry Goods Co. v. Lewis, 294 U. S. 550. But the tax on retailers held invalid in that case increased in rate with increasing volume. The Court said that the excise was laid upon the making of a sale, and that the statute “exacts from two persons different amounts for the privilège of doing exactly similar acts because the one has performed the act oftener than the other” (p. 566). For that reason it was thought necessary to inquire whether the tax could be justified as related to ability to pay, an inquiry we need not here pursue. The Court did not condemn a fixed-rate gross receipts tax, such as is involved in the présent case. Indeed it suggested that the “desired end” might hâve been secured by the widely adopted “fiat tax on sales” (p. 563), and indicated by way of contrast that though such a tax “would impose a heavier burden on the taxpayer having the greater volume 584 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. of sales” the graduated tax under considération exacted not only a larger gross amount but one “larger in proportion to sales” (p. 564). III. Relation to Object of Législation. As a further ground for the invalidity of the Local Laws the Corporation urges that “the classification must rest upon some ground of différence, having a fair and substantial relation to the object of the législation.” It is asserted, and cor-rectly so, that the Local Laws in question, as well as the state enabling statutes, show by their titles and content that the proceeds of the challenged taxes were for the relief of unemployment.7 Violation of the rule invoked, it is asserted, occurs from the discrimination shown by the législation in raising “a spécial fund for the particular purpose” from taxpayers no more responsible than others for the conditions. The Corporation seems to be of the opinion that no “state or city can, without conflict with the Constitution, adopt a tax statute, which states a spécifie object sought to be accomplished thereby and which at the same time puts the entire burden of the tax 7 N. Y. Laws 1934, c. 873 (the enabling act) : “An Act to enable, temporarily, any city of the state having a population of one million inhabitants or more to adopt and amend local laws, imposing in any such city any tax and/or taxes which the législature has or would hâve power and authority to impose to relieve the people of any such city from the hardships and suffering caused by unemployment and to limit the application of such local laws. . . . “§ 2. Revenues resulting from the imposition of taxes authorized by this act shall be paid into the treasury of any such city and shall not be credited or deposited in the general fund of any such city, but shall be deposited in a separate bank account or accounts and shall be available and used solely and exclusively for paying the principal amount of any installment of principal and of interest due during the aforesaid period on account of the ten-year serial bonds sold to obtain moneys to pay for home relief and work relief in any such city in the month of November, nineteen hundred thirty-three, and for the relief purposes for which the said taxes hâve been imposed under the provisions of this act.” RAPID TRANSIT CORP. v. NEW YORK. 585 573 Opinion of the Court. upon one particular class of business, even though that class is in no different position in relation to the object sought to be accomplished than business in general.” The brief States the point to be “that there is a distinction between the ordinary excise tax with no spécifie purpose attached thereto, and a tax which is a part of a plan for the accomplishment of a specified object.” The “object of the législation,” to the taxpayer, is apparently the relief of unemployment. While, of course, the object of this législation is in a sense to relieve unemployment, this is the object of the appropriation of the proceeds of the tax. The “object,” as used in the rule and cases referred to by the Corporation, is the object of the taxing provisions, i. e., the rais-ing of the money. If the désignation of utilities as the only taxpayers under the législation in question does not deny to them the equal protection of the laws, the fact that an appropriation of the funds for relief is a part of the législation is not significant. “A tax is not an assessment of benefits.” Carmichael v. Southern Coal & Coke Local Law No. 21 of 1934, as amended by Local Law No. 2 of 1935: “A local law to relieve the people of the city of New York from the hardships and suffering caused by unemployment and the effects thereof on the public health and welfare, by imposing an excise tax on the gross income of every person doing business within such city and subject to supervision of either division of the department of public service, and of any and ail other utilities doing business within such city to enable such city to defray the cost of granting unemployment, work and home relief. “§ 14. Disposition of Revenues.—Ail revenues and moneys resulting from the imposition of the taxes imposed by this local law shall be paid into the treasury of the city of New York and shall not be credited or deposited in the general fund of the city of New York but shall be deposited in a separate bank account or acccunts, and shall be available and used solely and exclusively for the purpose of relieving the people of the city of New York from the hardships and suffering caused by unemployment, including the repayment of moneys borrowed for such purpose.” 586 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. Co., 301 U. S. 495, 522. Taxes are repeatedly imposed on a group or class without regard to responsibility for the création or relief of the conditions to be remedied. Idem, note 14, p. 522. The Carmichael case involved a state act which levied a tax on employers of eight or more to provide unemployment benefits for workers employed by this class of employers. It was urged that the classification should hâve been based on the unemployment record of the employer, i. e., should hâve borne a relation to the object of unemployment relief. Against this contention, that there was no relation between the class of taxpayers and the purpose for which the fund was raised, this Court held that it is not necessary that there be “such a relationship between the subject of the tax (the exercise of the right to employ) and the evil to be met by the appropriation of the proceeds (unemployment)” p. 522. See also Cincinnati Soap Co. v. United States, 301 U. S. 308, 313. The Corporation suggests that in the Carmichael case there was a spécial relationship between the class taxed and the purpose for which the proceeds were spent, but the Court expressly said that this was something “the Constitution does not re-quire” (p. 523). There need be no relation between the class of taxpayers and the purpose of the appropriation. The cases cited by the Corporation to sustain its contention that classification must rest upon some ground of différence having a fair and substantial relation to the object of the législation, do not support the conclusion that the “object” referred to is the purpose for which the proceeds are to be spent. These authorities rather support the view that the “object” is the revenue to be raised by the acts. In Colgate v. Harvey, 296 U. S. 404, it was recognized that the classification “must rest upon some ground of différence having a fair and substantial relation to the object of the législation” (p. 423) but it RAPID TRANSIT CORP. v. NEW YORK. 587 573 Opinion of the Court. was said (p. 424) that “the object of the act . . . simply is to secure revenue.” In Stebbins v. Riley, 268 U. S. 137, Royster Guano Co. v. Virginia, 253 U. S. 412, and Air Way Appliance Corp. v. Day, 266 U. S. 71, the rule contended for by the Corporation was recognized but with no intimation that the “object” was considered to be the purpose for which the proceeds of the tax were spent. The “object” of the Local Laws under considération, as in the case with most tax statutes, was obviously to secure revenue. In some cases a classification of tax-payers may be upheld as having a fair and substantial relation to a constitutional non-fiscal object (Alaska Fish Co. v. Smith, 255 U. S. 44, 48; Quong Wing v. Kirk-endall, 223 U. S. 59, 62, 63; Aero Mayflower Transit Co. v. Georgia Public Service Comm’n, 295 U. S. 285, 291), but it is not constitutionally necessary that the classification be related to the appropriation. In United States v. Butler, 297 U. S. 1, also relied upon by the Corporation, the attack on the fédéral statute was successful because the tax was said to be a part of an unconstitutional scheme to regulate production through expenditures. It was not held invalid because there was no relation be-tween the taxpayer and the appropriation. See Cincinnati Soap Co. v. United States, supra. We conclude, therefore, that the provisions of the législation earmark-ing the funds collected are not of importance in determin-ing whether or not the classification of the challenged acts is discriminatory. What we hâve said in showing that the Local Laws do not deny the equal protection of the laws also disposes of the Corporation’s contention that the Local Laws constitute a deprivation of due process, as being meas-ured without regard to the net income of or ruinons effect on the taxpayers, and as laying on a particular class a burden which should be borne by ail. 588 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. IV. Contracts Clause.8 The Corporation contends that, in contravention of the Constitution, Article 1, § 10, the Local Laws impair the obligation of the contract known as Contract No. 4, entered into March 19, 1913, between its predecessor and the City, under which it opérâtes its owned and leased properties in New York. By the terms of the contract, as summarized in the Corporation’s complaint, the City agreed to construct certain rapid transit railroads, and the New York Municipal Railway Corporation, appellant’s predecessor, agreed to contribute a portion of the cost .of construction and to equip the railroads for operation. The latter further agreed to reconstruct and build additions to certain ex-isting railroads, which it then had the right and duty to operate, so as to adapt them for operation in conjunction with the railroads to be constructed by the City. Under the terms of Contract No. 4, the City leased the railroads which it agreed to construct, and their equipment, which was to be furnished by the lessee, to the New York Municipal Railway Corporation, its successors and assigns, for a term of forty-nine years commencing on or about the first day of January, 1917, and the lessee agreed to operate said railroads to be constructed by the City in conjunction with the existing railroads as one System, and for a single fare not exceeding five cents. The gross receipts of ail the railroads combined from whatever source derived, directly or indirectly, were to be pooled. The City and its lessee were to share the receipts equally after the déduction of certain items pro-vided in Article XLIX of Contract No. 4. It will suffi.ee here if we summarize the provisions for déductions in 8 In No. 436, the législation is not challenged as an impairment of an obligation of contract. The Brooklyn and Queens Transit Corporation “does not operate under Contract 4, but under Street railroad franchise from the City.” RAPID TRANSIT CORP. v. NEW YORK. 589 573 . Opinion of the Court. the language of appellant. The déductions were for the following purposes and in the following order: “1. Rentals actually paid by Lessee under leases ap-proved by the Commission; “2. Taxes [The full provision as to ‘taxes’ is set forth later]; “3. Operating expenses exclusive of maintenance; “4. Charges for maintenance of both the Railroad and the Existing Railroads [Railroad refers to the System to be constructed by the City; Existing Railroads refers to the company-owned lines as they existed at the time of execution of the contract] ; “5. Charges for dépréciation of the Railroad, the equip-ment, and the Existing Railroads; “6. To be retained by the Lessee: *4th of $3,500,000, representing the average income from operation of the Existing Railroads; “7. To be retained by the Lessee: ^th of 6% per an-num on (a) the Lessee’s contribution to cost of construction of the Railroad, (b) cost of equipment furnished by the Lessee, (c) cost of extensions and additional tracks constructed by the Lessee, and (d) cost of reconstruction of Existing Railroads (out of which quarterly payments the Lessee is required to amortize such costs) ; “8. To be retained by the Lessee: ^th of the actual annual interest payable by Lessee upon the cost of additional equipment, plus an amortization charge; “9. To be paid to the City: ^th of the annual interest payable by it upon its share of the cost of construction of the Railroad plus an amortization charge ; “10. To be paid to the City: ^th of the annual interest payable by the City upon cost of construction of additions to the Railroad plus an amortization charge ; “U. 1% of the gross receipts, to be paid into a contingent reserve fund. 590 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. “In connection with the above allocation provisions, Contract No. 4 provided (Art. LI, p. 66) that if in any quarter the gross receipts should be insufficient to meet the varions obligations and déductions above recited, the déficits should be cumulative, and payment thereof should be made in the order of priority above set forth.” The Corporation does not claim that Contract No. 4 exempts it or its property from taxation generally. It does assert that the City “may not, in the exercise of its gov-ernmental power, subject appellant to the payment of a tax on or measured by the gross receipts of the combined System of railroads,” and that “by providing in spécifie terms for the disposition and allocation of the entire gross receipts, the parties necessarily precluded any kind of tax or charge by the City which would directly and specifi-cally alter such disposition and allocation, to appellant’s préjudice, except in so far as any such tax or charge may clearly be said to hâve been provided for in the contract provisions as to the disposition of gross receipts.” The Corporation further complains that the tax pay-ments deprive it of “a substantial part of the interest and sinking fund allowance to which it was entitled” under déductions Nos. 7 and 8 set out above. The loss thus suffered was alleged to total more than $600,000. We search in vain for any provision in the contract which expressly exempts the Corporation from payment of this tax, or indeed of any tax. Yet this is what is required before support can be obtained from the con-tracts clause. More than a hundred years ago it was stated by Chief Justice Marshall, in Providence Bank v. Billings, 4 Pet. 514, 563, that the taxing power is of such “vital importance” that “We must look for the exemption in the language of the instrument; and if we do not find it there, it would be going very far to insert it by construction.” In Erie Ry. Co. v. Pennsylvania, 21 Wall. 492, 499, this Court said that “the language in which the sur- RAPID TRANSIT CORP. v. NEW YORK. 591 573 Opinion of the Court. render is made must be clear and unmistakable.” At the présent term, the Court has reiterated that contracts of tax exemption are “to be read narrowly and strictly,” Haie v. State Board, 302 U. S. 95, 109. See also Pacific Co. v. Johnson, 285 U. S. 480, 491; Puget Sound Power & Light Co. v. Seattle, 291 U. S. 619, 627. Not only is the Corporation unable to point to an ün-mistakable exemption, but the contract itself contains an express provision permitting the déduction of taxes from the gross receipts.9 Its language is broad. It refers to “ail taxes . . . of every description (whether on phys-ical property, stock or securities, corporate or other franchises, or otherwise) assessed or which may hereafter be assessed against the Lessee in connection with . . . the operation of the . . . Railroads.” The taxes under discussion clearly corne within its terms. It is alleged that at the time of the execution of the contracts, and prior to the passage of the state enabling acts,10 the tax power of the City was confined to spécial assessments for public improvements, and ad valorem taxes on real estate and spécial franchises issued by the City. The Corporation insists that it was contemplated that no other type of tax would be assessed, and that it was not necessary to make provision for exemption since the Corporation was merely accepting the tax burden com-mon to ail owners of property. It is urged that the contract be interpreted from this point of view, and the 9 The clause reads as follows: “Taxes, if any, upon property actually and necessarily used by the Lessee in the operation of the Railroad and the Existing Railroads, together with ail taxes or other govem-mental charges of every description (whether on physical property, stock or securities, corporate or other franchises, or otherwise) assessed or which may hereafter be assessed against the Lessee in connection with or incident to the operation of the Railroad and the Existing Railroads. Also such assessments for benefits as are not properly chargeable to cost of construction or cost of equipment.” 10 See supra note 2. 592 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. provision limited to taxes of the type which the City could hâve imposed in 1913. There is no reason to limit the ordinary meaning of words used in a contract by men prepared to invest under its terms. “ . . . a business proposition involving the outlay of very large sums cannot be and is not taken by the parties concemed according to offhand impressions; it is scrutinized phrase by phrase and word by word.” New York v. Sohmer, 237 U. S. 276, 284; cf. Ohio Ins. Co. v. Debolt, 16 How. 416, 435. Where the intention was to prevent the imposition of new taxés, adéquate language was available. The court below adverted to its opinion in Brooklyn Bus Corp. n. City of New York, 274 N. Y. 140; 8 N. E. 2d 309, where the contract entitled the corporation to a broader tax exemption because it provided that “any new form of tax or additional charge that may be imposed by any ordinance of the city or resolution of the Board upon or in respect of ’ the franchise . . . shall be deducted from the compensation payable to the City hereunder ...” A similar suggestion that the contract be limited to the taxes known at the time of its making was urged upon us, and discarded, in J. W. Perry Co.v. Norfolk, 220 U. S. 472. Under a lease made by Norfolk in 1792, when Norfolk was a borough without power to tax, the lessee agreed to pay, in addition to rent, “the public taxes which shall become due on said land.” The lessee sought to enjoin the collection of taxes in 1906 by the City of Norfolk, on the ground that the parties contemplated only taxes imposed by Virginia or the United States. This Court held that the language was broad enough to cover the city tax, saying (p. 480), that “the provision that the lessee was to ‘pay public taxes’ was sufficiently compréhensive to embrace municipal taxes whenever they could thereafter be lawfully assessed on land or the improve- RAPID TRANSIT CORP. v. NEW YORK. 593 573 Opinion of the Court. ments which were a part of the land. Where one relies upon an exemption from taxation, both the power to exempt and the contract of exemption must be clear. Any doubt or ambiguity must be resolved in favor of the public.” Admitting that with respect to a franchise contract silent as to taxes the city may validly impose a license tax on the privilège of doing business, since “surrender of the state’s power to tax the privilège is not to be implied from the grant of it,” Puget Sound Power & Light Co. n. Seattle, 29’1 U. S. 619, 627, it is urged by the Corporation that here the City is violating the affirmative covenants of a contract, namely, the provisions for allocation of revenue. The contention is made that these provisions preclude an “alteration” by virtue of a gross receipts tax. This Court, in construing a contract to détermine whether or not législation is violative of its provisions within the meaning of the contract clause of the Constitution, will examine for itself the existence and meaning of the contract as well as the relation of the parties and the circumstances of its execution. Appleby v. City of New York, 271 U. S. 364, 379-380; Funkhouser v. Preston Co., 290 U. S. 163, 167; Violet Trapping Co. v. Grâce, 297 U. S. 119, 120. But of course in so doing we “lean toward agreement with the courts of the state, and accept their judgments as to such matters unless manifestly wrong,” Haie v. State Board, 302 U. S. 95, 101; Tampa Water Works Co. n. Tampa, 199 U. S. 241,243-244; Southern Wisconsin Ry. Co. v. Madison, 240 U. S. 457, 461. In this case the Court of Appeals of New York, 275 N. Y. 258, 268; 9 N. E. 2d 858, has determined that “the right to tax cannot be lost by such tenuous implication,” i. e., on the theory that the tax enables the City to secure a portion of the gross income in contravention of the con- 594 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. tract. We see no reason for disagreeing with the conclusion of the Court of Appeals of New York upon this point. In effect, the Corporation is urging that a constructive condition restricting the City’s power of taxation should be incorporated in the contract, by spéculation as to what the parties must necessarily hâve intended, despite the long standing rule that exemptions must be “clear and unmistakable.” Erie Ry. Co. v. Pennsylvania, 21 Wall. 492, and other cases, ail cited supra. The Corporation professes to dread an interprétation of the contract and the législation, which will put it “wholly at the mercy” of the City; under which the Cor-poration’s gross receipts would be disposed of, not as Contract No. 4 provides, but as the City may from time to time in its wisdom détermine.” The Corporation is not deprived of its right to resist on constitutional or legal grounds whatever tax or assessment may be imposed upon it or its property. The City can not lay a gross receipts tax on the Corporation unless it selects a class of taxpayers which meets the requirement of the equal protection of the laws. The provisions of the contract as to taxes are certainly not sufficiently explicit to justify us in denying to the City the right to collect such taxes as those involved in this litigation. The danger which the Corporation sees from what it considers to be a violation by législation of its contract rights is a danger which every utility, with a franchise which does not protect its property from additional taxation, must endure. Convincing precedent for the contention of the City is found in North Missouri R. Co. n. Maguire, 20 Wall. 46, where this Court considered a statute of Missouri which provided that the railroad could issue bonds having pri-ority over the State’s mortgage. The Act made spécifie provision for the allocation of the earnings of the Railroad Company in much the same manner as Contract No. 4 RAPID TRANSIT CORP. v. NEW YORK. 595 573 Opinion of the Court. does in the présent case. The Act established a “fund commissioner” and provided that the railroad company should pay over to this commissioner “ail the gross earnings and daily receipts.” It was provided that the commissioner should first pay amounts required for “actual current expenditures”; should then make other specified déductions, and lastly, should apply any excess to certain first mortgage bonds and then against the railroad’s debt to the State. Subsequently the State Constitution was amended to provide that an annual tax of 10% of the gross receipts should be levied on the North Missouri Railroad Company and two other named corporations. The state court held that the earlier statute constituted a contract but considered the payment of taxes to fall within “current expenditures for carrying on the ordinary business.” In this Court, the company argued that the tax constituted a violation of this contract, since it overturned the allocation of receipts and had the effect of converting the State from a junior creditor to a first mortgagee. This Court agreed that “serions difficulty” would arise if “the ordinance was a mere change of the order of disbursing the receipts and earnings,” instead of “an expression of the sovereign will of the people of the State levying taxes to pay and discharge the indebtedness of the State,” but concluded that the tax actually imposed was proper. Of the provisions for allocation of the gross receipts, the Court said (p. 63) : “Further examination of those provisions is certainly unnecessary, as it is too plain for argument that they do not afford the slightest support to the views of the plain-tiffs. On the contrary, they are entirely silent upon the subject of taxation, and fully justify the remarks of the State court when they say that the subject of taxation forms no part of the contract contained in the act under considération. 596 OCTOBER TERM, 1937. Syllabus. 303 U. S. “Nothing is said about taxation, and it does not seem to hâve entered into the contract between the parties, but was obviously left where the law had placed it before the act was passed, nor was any provision made for the payment of taxes unless it may be held that the disburse-ments for that purpose may fairly be included in such as are required to pay the current expenditures in carry-ing on the ordinary business of the corporation.” In our opinion, as the contract does not prohibit this tax, the législation does not violate the contracts clause. Affirmed. Mr. Justice Stone and Mr. Justice Cardozo took no part in the considération or decision of this case. SHANNAHAN et al., TRUSTEES, v. UNITED STATES et al. APPEAL FROM THE DISTRICT COURT OF THE UNITED STATES FOR THE NORTHERN DISTRICT OF INDIANA. No. 502. Argued February 28, March 1, 1938.—Decided April 4,1938. The Railway Labor Act confers upon the National Médiation Board certain duties respecting médiation or arbitration of labor con-troversies on railroad carriers subject to the Interstate Commerce Act, with the proviso that the term “carrier” shall not include any Street, interurban, or suburban electric railway not operating as a part of a general steam-railroad System of transportation, etc., and directs the Interstate Commerce Commission upon request of the Médiation Board or upon complaint of any party interested to détermine after hearing whether any line operated by electric power falls within the proviso. Held: 1. That a decision of the Commission finding a railway not to be a Street, interurban, or suburban electric railway within the meaning of the proviso was not an “order,” either in form or in substance, but a détermination of fact, négative in character, and not enforceable by the Commission or by the Board. Therefore it was not reviewable under the Urgent Deficiencies Act of 1913. P. 599. SHANNAHAN v. UNITED STATES. 597 596 Opinion of the Court. 2. The argument that the decision is reviewable as an “order” under the Urgent Deficiencies Act, because it fixes the status of the carrier as subject to obligations of the Railway Labor Act wilful failure to comply with which is made a misdemeanor,—is con-sidered and rejected. P. 601. 20 F. Supp. 1002, affirmed. Appeal from a decree of a three-judge District Court dismissing for want of jurisdiction a bill to set aside an alleged order of the Interstate Commerce Commission. Mr. John C. Lawyer, with whom Mr. R. Stanley Anderson was on the brief, for appellants. Mr. Léo F. Tierney, with whom Acting Solicitor General Bell, Assistant Attorney General Jackson, and Messrs. Wendell Berge, Robert L. Stem, Nelson Thomas, and Daniel W. Knowlton were on the brief, for appellees. Mr. Justice Brandeis delivered the opinion of the Court. The sole question for decision is whether the District Court had jurisdiction of this controversy under the Urgent Deficiencies Act of October 22, 1913.1 The Chicago South Shore and South Bend Railroad is an interstate electric railway subject to the Interstate Commerce Act. On August 9, 1934, the National Médiation Board requested the Commission to détermine whether that carrier fell within the exemption from the scope of the Railway Labor Act, as amended June 21, 1934, 48 Stat. 1185, c. 691 (45 U. S. C. § 151). That Act confers upon the National Médiation Board certain du-ties in respect to carriers by railroad subject to the Interstate Commerce Act, with the following exception: “Provided, however, That the term ‘carrier’ shall not include any Street, interurban, or suburban electric rail- 1 c. 32, 38 Stat. 208, 219, 220, 28 U. S. C. §§ 41(28), 46, 47. 598 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. way, unless such railway is operating as a part of a general steam-railroad System of transportation, but shall not exclude any part of the general steam-railroad System of transportation now or hereafter operated by any other motive power. The Interstate Commerce Commission is hereby authorized and directed upon request of the Médiation Board or upon complaint of any party interested to détermine after hearing whether any line operated by electric power falls within the terms of this proviso.” After due hearing had, at which the South Shore in-troduced evidence and filed its brief, the matter was argued orally before the Commission, which, on February 14, 1936, made its Report and the foliowing détermination (214 I. C. C. 167, 173) : “We find that the line of the Chicago, South Shore and South Bend Railroad is not a Street, interurban, or suburban electric railway within the meaning of the exemption proviso in the first paragraph of Section 1 of the Railway Labor Act, as amended June 21, 1934, and it is therefore subject to the provisions of that act.” No order was entered thereon by the Commission. Shannahan and Jackson, who had been appointed Trustées of the South Shore by the fédéral court for northern Indiana, and had filed their appearance in the proceeding, applied for a rehearing. An order was entered denying the same. Thereupon, the Trustées filed this suit against the United States, invoking the jurisdiction of the court under the Urgent Deficiencies Act of October 22, 1913, to set aside the alleged order. They do not deny that the South Shore is an interstate carrier subject to the jurisdiction of the Commission; and that the Act is constitutional. Their contention is that : “A correct application of the law to the undisputed facts leads to the conclusion that the lines of the railroad of appellants are an electric interurban railway under the SHANNAHAN v. UNITED STATES. 599 596 Opinion of the Court. exemption proviso of the first division of Section 1 of the Railway Labor Act and that there is no substantial evidence to support the conclusion and détermination of the Commission.” The Commission intervened. Its answer, and that of the United States, challenged, the juridiction of th'e court on the ground that the détermination of the Commission was not an “order” within the meaning of the Urgent Deficiencies Act. The case was heard before three judges on the pleadings and evidence; and a decree was entered dismissing the bill for want of jurisdiction, one judge dissenting. 20 F. Supp. 1002. The Trustées appealed. First. The function of the Commission is limited to the détermination of a fact. Its decision is not even in form an order. It “had no characteristic of an order, affirmative or négative.” United States v. Illinois Cent. R. Co., 244 U. S. 82, 89; United States v. Atlanta, B. & C. R. Co., 282 U. S. 522, 527-28. Compare Lehigh Valley R. Co. v. United States, 243 U. S. 412, 414. But even if this difficulty is overlooked, others are insuperable. The decision neither commands nor directs anything to be done. “It was merely préparation for possible action in some proceeding which may be instituted in the future.” United States v. Los Angeles & S. L. R. Co., 273 U. S. 299, 310. The détermination is thus not enforceable by the Commission; the only action which could ever be taken on it would be by some other body. It is as clearly “négative” as orders by which the Commission refuses to take requested action. United States v. Griffin, ante, p. 226.2 As such, it is not reviewable under the Urgent Deficiencies Act. 2 See also Procter & Gamble Co. v. United States, 225 U. S. 282; Hooker v. Knapp, 225 U. S. 302; Lehigh Valley R. Co. v. United States, 243 U. S. 412, 414; Manufacturers Ry. Co. v. United States, 246 U. S. 457, 482-83; Atchison, T. & S. F. Ry. Co. v. United States, 600 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. Second. Moreover, the détermination of the Commission is not even a decision which the Médiation Board, by whom it was sought, is empowered to enforce. The Act confers upon the Board no power over any carrier. It merely imposes upon the Board possible duties in respect to interstate carriers by railroad not exempted by the proviso. The Board’s duties, in case of dispute between carrier and employées, require it: (1) to “promptly put itself in communication with the parties to [the] controversy, and . . . use its best efforts, by médiation, to bring them to agreement.” When a dispute is settled through these efforts a médiation agreement is signed, and should any question arise subsequently regarding the meaning or application of such an agreement, the Board is required upon request of either party “and after a hearing of both sides [to] give its interprétation within thirty days.” (2) If the mediating efforts prove unsuccessful, it is the Board’s duty to “at once endeavor as its final required action . . . to induce the parties to submit their controversy to arbitration, in accordance with the provisions of” the Act. If arbitration is agreed upon it may become the Board’s duty to name a third arbitrator if the two named by the parties fail to select him. (3) If arbitration is refused and the dispute threatens “substantially to interrupt commerce to a degree such as to deprive any section of the country of essential transportation service,” then the Board is required to notify the President. (4) If, in selecting représentatives to deal with the carriers, disputes arise among employées as to what organization they desire to represent them, it is the duty of the Board, on request of either party, to investigate 279 U. S. 768, 781; Piedmont & Northern Ry. Co. v. United States, 280 U. S. 469, 475-77; Standard Oil Co. v. United States, 283 U. S. 235, 238; United States v. Corrick, 298 U. S. 435, 438. SHANNAHAN v. UNITED STATES. 601 596 Opinion of the Court. and to certify in writing to the parties and to the carrier the names of the individuals or organizations that hâve been designated and authorized to represent the employées. (5) If the National Railroad Adjustment Board un-dertakes arbitration, and it fails to select a referee, the Médiation Board has the duty of doing so. In order not to fail in the performance of these duties the Médiation Board had to satisfy itself whether the South Shore was a railroad within the exemption proviso. To that end, it applied to the Commission for its détermination. If it had omitted to do so, the application might hâve been made “upon complaint of any party in-terested.” The détermination, whether applied for by the Board, by a carrier, or by employées, is clearly not an order enforceable within the meaning of the cases construing and applying the Urgent Deficiencies Act. It is a decision on a controverted matter, comparable to those considered in United States N. Los Angeles & Sait Lake R. Co, 273 U. S. 299, in Great Northern Ry. Co. v. United States, 277 U. S. 172, in United States v. Atlanta, B & C. R. Co., 282 U. S. 522, and in United States v. Griffin, ante, p. 226, which were held not to be subject to review under the Urgent Deficiencies Act. Third. The Trustées argue that the détermination of the Commission is an affirmative “order, because it fixed for the first time, by the only body authorized by law to do so, the status of the carrier” ; that by fixing the status, the obligations of the Railway Labor Act are fixed upon the carrier; and that wilful failure or refusai of any carrier to comply with certain of the obligations is made a misdemeanor.3 345 U. S. C. § 152(10). That déclarés: “The willful failure or refusai of any carrier, its officers or agents, to comply with the terms of the third, fourth, fifth, seventh or eighth paragraph of this section shall be a misdemeanor. . . .” The third paragraph prohibits inter- 602 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. Lehigh Valley R. Co. v. United States, supra, shows that the détermination of a status or similar matter is not action subject to review under the Urgent Deficien-cies Act even if disregard of the détermination may subject the carrier to criminal prosecution.4 The Panama Canal Act, 37 Stat. 560, prohibited, after July 1, 1914, any ownership by a railroad in any common carrier by water where the railroad might compete with the water carrier; prescribed a heavy penalty for any violation of the prohibition; and conferred upon the Commission jurisdiction : “to détermine questions of fact as to the compétition or possibility of compétition, after full hearing, on the application of any railroad company or other carrier. Such application may be filed for the purpose of determining whether any existing service is in violation of this section and pray for an order permitting the continuance of any vessel or vessels already in operation . . Thereupon in January, 1914, the Lehigh Valley filed with the Commission a pétition for a hearing on the question whether the services of a steamboat line owned by it would be in violation of the above section and for an extension of time. The Commission held that, by vir- ference, influence or coercion in the désignation of représentatives. The fourth assures the right of employées to bargain collectively through représentatives of their own choosing, and forbids carriers to maintain or financially assist any labor organization. The fifth prohibits carriers from requiring any person seeking employment to sign any contract to join or not to join a labor union. The seventh prohibits carriers from changing rates of pay, rules or working conditions of employées as a class except as prescribed in § 156. The eighth requires carriers to notify its employées by printed notices in such form as shall be specified by the Médiation Board that ail disputes will be handled in accordance with the requirements of the Act. 4 For details, see opinion of the District Court for Eastern Pennsylvania, 234 Fed. 682. 596 SHANNAHAN v. UNITED STATES. Opinion of the Court. 603 tue of the arrangements found to exist, the railroad did or might compete with its boat line; and dismissed the pétition. This Court held that the risk to which the railroad was left subject did not corne from the order, but from the statute which contained the prohibition and provided a penalty ; that, theref ore, it was not an affirmative order; and that the District Court was without jurisdiction under the Urgent Deficiencies Act. Compare also Piedmont & Northern Ry. Co. v. United States, 280 U. S. 469, 476-77. Fourth. Whether the détermination of the Commission is reviewable in a district court by some judicial procedure other than that of the Urgent Deficiencies Act we hâve no occasion to consider. Compare United States v. Griffin, supra, and Lehigh Valley Ry. Co. v. United States, supra.5 Affirmed. Mr. Justice Cardozo took no part in the considération or decision of this case. 5 In Utah-Idaho Cent. Ry. v. Shiélds (unreported), D. Utah, Oct. 15, 1936, and in Hudson & Manhattan Ry. v. Hardy, S. D. N. Y., Feb. 21, 1938, 22 F. Supp. 105 (where jurisdiction under the Urgent Deficiencies Act was specifically denied), the electric railways involved were declared in proceedings before single judges to be within the proviso excluding them from the application of the Act, and final injunc-tions against prosecution for penalties were granted, although the Interstate Commerce Commission, in 2141. C. C. 707 and 216 I. C. C. 745, respectively, had reached the opposite conclusion. In Texas Electric Ry. v. Eastus (unreported), N. D. Tex., June 4, 1936, a preliminary injunction was likewise granted in spite of the Commission’s decision in 208 I. C. C. 193. From informai sources it has been learned that similar proceedings hâve been instituted in other cases. Chicago Warehouse & Term. Co. n. Igoe, N. D. 111., and Chicago Tunnel Co. v. Igoe, N. D. 111., to review 214 I. C. C. 81; Hudson & Manhattan Ry. v. Quinn, D. N. J., to review 216 I. C. C. 745; New York, W. & B. R. Co. v. Hardy, S. D. N. Y., to review 218 I. C. C. 253. 604 OCTOBER TERM, 1937. Syllabus. 303 U. S. COVERDALE, SHERIFF AND EX-OFFICIO TAX COLLECTOR, v. ARKANSAS-LOUISIANA PIPE LINE CO. APPEAL FROM THE DISTRICT COURT OF THE UNITED STATES FOR THE WESTERN DISTRICT OF LOUISIANA. No. 458. Argued February 28, 1938.—Decided April 4, 1938. A corporation produced and purchased natural gas in Louisiana, piped it from the wells to the Louisiana terminus of its interstate pipeline, and introduced it into that line under increased pressure induced by the power of gas engines operating gas compressors. Nearly ail of the gas was transported and disposed of in interstate commerce, and the increase of pressure was essential to its move-ment through the pipeline. As a complément to taxation of the génération and sale of electricity, Louisiana laid a privilège tax on operation of machines for production of mechanical power used by the operator in his business within the State, the tax being meas-ured on the horsepower capacity of such machines. Held: 1. That, applied to the operation of the corporation’s gas engines, the tax was not invalid as a burden on the interstate commerce. P. 609. 2. Taxation by the States of the business of interstate commerce is forbidden only because it is deemed an interférence with that commerce, the uniform régulation of which is necessarily reserved to the Congress. P. 610. 3. Exemption of those engaged in interstate commerce from the taxation others bear should not be extended beyond the necessity of keeping that commerce free from interférence. P. 610. 4. Privilèges closely connected with interstate commerce may be regarded as distinct for purposes of taxation. P. 610. 5. While the engine and compresser units are connected directly, on a common bed plate, their functions are as completely separate as if they operated through belting. While the use of the engine for the production of power synchronizes with the transmission of that power to the compresser, production occurs prior to transmission. Cf. Utah Power & Light Co. v. Pfost, 286 U. S. 165. P. 611. 6. The tax is without discrimination in form or application as between interstate and intrastate commerce and is not such as can be imposed by more than one State. It obviously adds to the 604 COVERDALE v. PIPE LINE CO. Opinion of the Court. 605 cost of the interstate commerce. But increased cost alone is not sufficient to invalidate the tax as an interférence with that commerce. Cf. Western Live Stock v. Bureau of Revenue, ante, p. 250. P. 612. 20 F. Supp. 676, reversed. Appeal from a decree of the three-judge District Court which permanently enjoined the sheriff from enforcing a state tax found to be unconstitutional. See also 17 F. Supp. 34, 36. Messrs. E. Leland Richardson and F. A. Blanche, Assistant Attorneys General, with whom Messrs. Gaston L. Porterie, Attorney General, and J. C. Daspit, Assistant Attorney General, of Louisiana, were on the brief, for appellant. Mr. Leon O’Quin, with whom Mr. H. C. Walker, Jr. was on the brief, for appellee. Mr. Justice Reed delivered the opinion of the Court. The question is whether a state statute imposing a privilège tax on the production of mechanical power con-travenes the interstate commerce clause in so far as it is applied to an engine used to supply mechanical power to a compressor which increases the pressure of natural gas and thus permits it to be transported to purchasers in other States. Act No. 6 of the Regular Session of 1932 of the Louisiana Législature, with certain qualifications and exceptions not material here, provides for a license tax to be paid by everyone engaged within the State in the business of manufacturing or generating electricity for heat, light or power, § 1, or of selling electricity not manufactured or generated by him or it, § 2. Section 3 provides that every person, firm, corporation, or association, engaged within the State in any business, which uses in the conduct of 606 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. that business electrical or mechanical power of more than ten horsepower and does not procure ail the power from a taxpayer subject to § 1 or § 2, “shall be subject to the payment of an excise, license, or privilège tax of One Dollar ($1.00) per annum for each horsepower of capacity of the machinery or apparatus, known as the ‘prime mover’ or ‘prime movers,’ operated by such person, firm, corporation or association of persons, for the purpose of producing power for use in the conduct of such business or occupation; . . Appellee is engaged within Louisiana, Arkansas, and Texas, in the business of producing and buying, trans-porting and selling natural gas. The gas is obtained from the Monroe and Richland fields in Louisiana, and transported through appellee’s 20-inch pipe line, one of the largest in the Southwest, which extends from Ster-lington, Louisiana, to Blanchard, Louisiana, where one branch goes west into Texas, and the other north into Texas and Arkansas up to Little Rock. Ninety-six and 6/10 per cent. (96.6%) of the gas transported through this line during the fiscal year ended July 31, 1933, was delivered outside the State of Louisiana. The natural gas cannot be transmitted through this pipe line for these distances in amounts sufficient to meet the needs of appellee’s customers, unless it is delivered into the pipe line at a pressure higher than that at which it cornes from the wells. Accordingly, appellee maintains in Louisiana, at the point of intake into the line, its “Munce Compressor Station” where are lo-cated ten pumps, or natural gas compressors, which op-erate to increase the pressure of the gas to the required extent. These compressors are directly connected to ten four-cylinder 1,000 horsepower Cooper Bessemer internai combustion gas burning engines. There are also two 250 horsepower gas burning engines for general power service at the station. The tax is laid on the privilège 604 COVERDALE v. PIPE LINE CO. Opinion of the Court. 607 of operating these twelve gas engines, known as “prime movers,”1 and is imposed at the rate of $1 per horse-power capacity of the engine—i. e., a total tax of $10,500. Appellee’s complaint, setting forth these facts, was filed in the District Court for Western Louisiana. It prayed that the tax be declared invalid and that the appellant, sheriff, be enjoined from selling appellee’s property to en-force payment of $7,316, plus certain penalties and attorney fees, as the balance of the “prime mover tax” due for the year ending July 31, 1933.2 An ex parte tempo-rary restraining order was issued. A statutory three-judge court was convened, and a preliminary injunction granted, 17 F. Supp. 34. The statute was held invalid for the reason, among others, that as applied to this case it imposed an unconstitutional burden on interstate commerce. On a rehearing, the court, with one dissent, de-termined again that it was invalid, with the violation of the commerce clause as the sole basis of decision, 17 F. Supp. 36.3 After answer and submission of affidavits 1 This term, used in § 3, supra, is not defined elsewhere in the statute. Webster’s New International Dictionary (2d ed. unabridged, 1936) p. 1964, contains the following: “prime mover. Mech. ... b An initial source of motive power, as an engine, or machine, the object of which is to receive and modify force and motion as sup-plied by some natural source, and apply them to drive other machin-ery, as a water wheel, a water-pressure engine, a wind-mill, a turbine, a tidal motor, a steam engine or other heat engine, etc.” As ex-plained by expert witnesses for the appellant, the internai combustion gas engine is a prime mover which converts heat energy, contained in the natural gas as fuel, into mechanical energy, then supplied to and used by the compresser unit. 2 Appellee alleged that it had paid part of the tax imposed by the statute in order to avoid a forced sale. 3 The first opinion also held the statute invalid in its entirety (on the authority of Union Sulphur Co. v. Reid, 17 F. Supp. 27), as a property tax laid at a rate prohibited by the state constitution, and as a déniai of due process in providing for collection without any review of the action of the state superviser of public accounts. After 608 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. by both parties, the court granted a permanent injunction, 20 F. Supp. 676. The case was brought here on direct appeal. Judicial Code, §§ 238 (3), 266, 28 U. S. C. §§ 345 (3) 380. First. The character of the tax act under considération is clear. It is a revenue measure obtaining funds by levy-ing a privilège tax on those generating or selling electric-ity in Louisiana. § § 1 and 2. Presumably to protect this source of revenue against tax-free compétition, § 3,4 with the decision in State v. H. L. Hunt, Inc., 182 La. 1073; 162 So. 177, holding the tax a license rather than a property tax, consonant with both the state constitution and Fourteenth Amendment, the District Court granted a rehearing. The second opinion conceded the general validity of the act, but held it an undue burden on interstate commerce as applied to appellee. 4 “Section 3. In addition to ail other taxes of every kind imposed by law, every person, firm, corporation or association of persons engaged in the State of Louisiana in any business or occupation, which person, firm, corporation or association of persons uses in the conduct of such business or occupation, at any time, electrical or mechanical power of more than ten horsepower and does not procure ail the power required in the conduct of such business or occupation from a person, firm, corporation or association of persons subject to the tax imposed by Section 1 or Section 2 of this act, shall be subject to the payment of an excise, license or privilège tax of One Dollar ($1.00) per annum fer each horsepower of capacity of the machinery or apparatus, known as the 'prime mover’ or 'prime movers’, operated by such person, firm, corporation or association of persons, for the purpose of producing power for use in the conduct of such business or occupation; provided that any user of power securing ail or any part of the power required in the conduct of the business or occupation of such user from a person, firm, corporation or association of persons subject to the tax imposed by Section 1 or Section 2 of this act, shall not be liable for the tax imposed by this Section 3, or for a greater tax under this Section 3, as the case may be, because of the employment of stand-by power facilities by such user during periods of failure of the supply of purchased power; and provided further that any person, firm, corporation or association of persons the principal use of whose electric facilities is the génération of electricity for sale, shall not be subject to an additional tax under 604 COVERDALE v. PIPE LINE CO. Opinion of the Court. 609 broad exemptions not assailed here, subjects the users of electrical or mechanical power, not procured from those subject to § 1 or § 2, to a tax of one dollar per annum for each horsepower of capacity of the machinery operated by the taxpayer for the purpose of producing this power. The state court has held that section three, here in question, does not lay a tax on those who own the machines but on those who use them in the conduct of their business, State v. H. L. Hunt, Inc., 182 La. 1075, 1079-1080; 162 So. 777, a decision accepted, so far as the incidence of the tax is concemed, as a matter of local law conclusive on us. St. Louis & S. W. R. Co. v. Arkansas, 235 U. S. 350, 362; Storaasli v. Minnesota, 283 U. S. 57, 62. We regard the tax as one upon the privilège of producing the power. Second. The language of the state statute makes it quite certain that this privilège tax falls alike on those engaged in interstate or in intrastate commerce, or in both. While a privilège tax by a state for engaging in interstate business has frequently met the condemnation of this Court as a régulation of commerce,5 privilège taxes this Section 3 on the horsepower capacity of any machinery or apparatus used in the génération of electricity; and provided further that in computing the tax imposed by this Section 3, there shall be excluded from the horsepower capacity of ail machinery and apparatus operated, that part of such capacity used in a mechanical, agricultural or horticultural pursuit, or any other occupation exempt from a license tax under Section 8 of Article X of the Constitution of Louisiana, or in operating a sawmill or a mill for grinding sugar-cane or producing raw sugar, or in conducting any business of selling electricity or any business conducted under any franchise or permit granted by the State of Louisiana or any subdivision thereof, or in propelling or motivating any automobile, truck, tug, vessel, or other self-propelled vehicle, on land, water or air.” 5 Cooney v. Mountain States Tel. Co., 294 U. S. 384, 392, and cases cited in note four; Puget Sound Stevedoring Co. v. State Tax Comm’n, 302 U. S. 90; Fisher’s Blend Station v. State Tax Comm’n, 297 U. S. 650; Sprout v. South Bend, 277 U. S. 163, 170, 175. 53383°—38---------39 610 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. for “carrying on a local business,” even though measured by interstate business, hâve been sustained. American Mfg. Co. v. St. Louis, 250 U. S. 459; Ficklen v. Shelby County Taxing District, 145 U. S. 1;6 cf. Western Live Stock v. Bureau of Revenue, ante, p. 250. The présent case falls well within the line of state tax authority. Taxation by the states of the business of interstate commerce is forbidden only because it is deemed an interférence with that commerce, the uniform régulation of which is necessarily reserved to the Congress. Minnesota Rate Cases, 230 U. S. 352, 400. As this source of revenue, even if treated in a non-discriminatory manner, is withdrawn from local reach by inference from the dele-gated grant, the exemption of those engaged in interstate commerce from the taxation others bear should not be extended beyond the necessity of keeping that commerce free from interférence. Consequently, property taxes on the instrumentalities or net income taxes on the proceeds of interstate commerce are upheld. Cudahy Packing Co. v. Minnesota, 246 U. S. 450; United States Glue Co. v. Oak Creek, 247 U. S. 321. Privilèges closely connected with the commerce may be regarded as distinct for purposes of taxation. So, local privilège taxes on storage in transit, compressing or deal-ing in cotton, already moving in its interstate journey from plantation to mill, are validated as imposed upon operations in connection with a commodity withdrawn from the transportation movement. Fédéral Compress Co. v. McLean, 291 U. S. 17, 21; Chassaniol v. Greenwood, 291 U. S. 584; cf. Minnesota v. Blasius, 290 U. S. 1. And similar taxes are upheld for the privilège of mining ores or producing gas, notwithstanding the “prac-tical continuity” of the taxed productive operation and the interstate movement. Oliver Iron Min. Co. v. Lord, 6 But see Crew Levick Co. v. Pennsylvania, 245 U. S. 292, 296. COVERDALE v. PIPE LINE CO. 611 604 Opinion of the Court. 262 U. S. 172; Hope Natural Gas Co. v. Hall, 274 U. S. 284. In Utah Power & Light Co. v. Pjost, 286 U. S. 165, an Idaho statute taxing the génération of electricity at so much a kilowatt hour was upheld because a différence was perceived between the conversion of the mechanical energy of falling water into electrical energy and the transportation of the latter. The tax here imposed on the operation of the machinery is of the same type. The power used by the appellee is obtained from internai combustion engines which transform the potential energy of natural gas into mechanical power, transmitted by piston and piston-rod from the combustion chamber of the engine to the compression chamber of the com-pressor. While the engine and compressor units are as-sembled on a common bed plate, their functions are thus seen to be as completely separate as if they operated through belting. The engine is the “prime mover” of the tax act, producing power to drive the compressor. While the use of the engine for the production of power syn-chronizes with the transmission of that power to the compressor, production occurs prior to transmission. It is just as much local as the génération of electrical power. Helson v. Kentucky, 279 U. S. 245, State Tax Commission v. Interstate Natural Gas Co., 284 U. S. 41, and Cooney N. Mountain States Tel. Co., 294 U. S. 384, are pressed upon us as controlling authorities for the invalidation of the tax. We think they belong to the category of cases which construe the state tax acts involved as taxes on interstate commerce and its instrumentalities rather than on operations closely connected with but distinct from that commerce. In the Interstate case and the Cooney case taxes levied on the business of engaging in interstate commerce were held invalid. Likewise, in the Helson case, this Court concluded that the tax on gasoline brought into the state and used on an interstate ferry was analogous to a tax on the use of the ferry itself 612 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. in transit and therefore within the rule prohibiting state taxes on commerce. A narrow distinction in fact exists between the tax held invalid in the Helson case and the valid tax considered in Nashville, C. & St. L. Ry. Co. v. Wallace, 288 U. S. 249, where a tax on gasoline brought into the state, stored and then used to drive engines in interstate transportation, was held valid. The storage and withdrawal was an intrastate, taxable event. See also Edelman v. Boeing Air Transport, 289 U. S. 249, 252; Gregg Dyeing Co. n. Query, 286 U. S. 472, 479. Third. To détermine whether this challenged state tax enactment is invalid as an interférence with interstate commerce under the decisions of this Court, the connection of the privilège taxed with interstate commerce has been considered. Other factors also show that the tax here does not interfère with interstate commerce. The tax is without discrimination in form or application as between inter- and intra-state commerce and it cannot be imposed by more than one state. The course of interstate commerce is clogged by taxes designed or applied so as to hamper its free flow. Section three, however, bearing equally on ail use, is only complementary to the taxes of sections one and twO. Hennejord v. Silos Mason Co., 300 U. S. 577, 584. It bears generally on ail use of power and is not discriminatory. It obviously adds to the cost of the interstate commerce. But increased cost alone is not sufficient to invalidate the tax as an interférence with that commerce. Western Live Stock v. Bureau of Revenue, ante, p. 254. It was held by the District Court that this is a tax which may be levied by other states and so is invalid, and that a state’s desire to save gas for its citizens may induce it to raise the privilège tax to prohibitory rates. It is true that each state through which a pipe line passes could lay a tax on the use of engines for the production of power, but that would not be multiple taxation HALE v. KENTUCKY. 613 604 Counsel for Parties. “merely because interstate commerce is being done,” as discussed in Western Live Stock v. Bureau of Revenue, ante, p. 255, and the authorities there cited. It would not be a tax on the same activity, either in form or in substance. Like a property tax on the pipes or equipment in different states, it would be a different tax, on a different and wholly separate subject matter, with no cumulative effect caused by the interstate character of the business. It would not be multiple taxation for each state to tax the “booster station” ad valorem as property. Neither is it prohibited multiple taxation to hâve the possibility of other privilège taxes on the production of power. It is length of line, not interstate commerce, which makes another tax possible. The decree of the District Court is Reversed. Mr. Justice McReynolds is of the opinion the decree should be affirmed. Mr. Justice Cardozo took no part in the considération or détermination of this case. HALE v. KENTUCKY. CERTIORARI TO THE COURT OF APPEALS OF KENTUCKY. No. 680. Argued March 29, 1938.—Decided April 11, 1938. Proofs held sufficient to show a systematic and arbitrary exclusion of Negroes from jury lists because of their race or color, constitut-ing a déniai of the equal protection of the laws, and entitling the petitioner, a Negro convicted of murder, to a new trial. P. 616. 269 Ky. 743; 108 S. W. 2d 716, reversed. Certiorari, post, p. 629, to review a judgment afîirming a sentence for murder. Messrs. Charles H. Houston and Leon A. Ransom for petitioner. 614 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. Mr. A. E. Funk, Assistant Attorney General, with whom Hubert Meredith* Attorney General, of Kentucky, was on the brief, for respondent. Per Curiam. Petitioner, a Negro, was indicted in 1936 for murder in McCracken County, Kentucky. He moved to set aside the indictment upon the ground that the jury commis-sioners had excluded from the list from which the grand jury was drawn ail persons of African descent because of their race and color and thus denied to him the equal protection of the laws in violation of the Constitution of the United States. In support of his motion, he presented an affidavit showing that the population of McCracken County was approximately 48,000 of which 8,000 were Negroes; that the assessor’s books for the county con-tained the names of approximately 6,000 white persons and 700 Negroes who were qualified for jury service in accordance with the Kentucky Statutes, § 2241; that the jury commissioners filled the wheel for jury service for 1936 with between 500 and 600 names exclusively of white citizens and that no Negro was excluded “because he was not an intelligent, sober, discreet and impartial citizen, résident housekeeper” of the county or not of the requisite âge; that the failure to draw any Negro for service was not due to any of the disqualifications mentioned in the Kentucky Statutes, § 2248. The affidavit further stated that petitioner could prove by sheriffs of McCracken County, serving respectively from 1906 to 1936, that during their terms no Negroes had been summoned for service on any grand or petit jury in the county nor was the name of any Negro placed in the hands of the sheriff to be so summoned; also that petitioner could prove by fédéral officiais that for many years prior to 1936 Negro citizens of the county had served on juries in the fédéral court at Paducah; also that petitioner could HALE v. KENTUCKY. 615 613 Opinion of the Court. prove by many named citizens of standing in the com-munity that for a long period of years there were Negroes who were citizens of the county and qualified for service on juries in the state court. Petitioner alleged that the proof would show “a long continued, unvarying and Wholesale exclusion of Negroes from jury service in this County on account of their race and color,” and that this practice had been “systematic and arbitrary” on the part of the officers and commissioners selecting names for jury service for a period of fifty years or longer. Petitioner filed a supplémentai affidavit stating that he had learned that in. one case in the state court in 1921 the trial judge had directed a Negro jury to be summoned from bystanders, but that those Negro jurors were not on the jury panel. The attorney for the State stipulated that the original and supplémentai affidavits should be considered as evidence and that the witnesses named would testify as therein set forth. No evidence to the contrary was in-troduced by the State. The motion to set aside the in-dictment was overruled. Petitioner then moved to discharge the entire panel of the jury for cause, upon the same facts, and the motion was denied. Petitioner, having reserved his exceptions, pleaded not guilty and the trial proceeded. He was convicted and sentenced to death. The judgment was affirmed by the Court of AppealS of the State. 269 Ky. 743; 108 S. W. 2d 716. It appears from an affidavit of the clerk of the circuit court of McCracken County that by inadvertence a copy of the motion to set aside the indictment was omitted from the record before the Court of Appeals. That court, after a summary of the facts shown by the record said that the case was one “where the proof might be regarded as sufficient to sustain the ground upon which the motion was evidently made, but there is wanting in the record a sufficient statement of those grounds to per- 616 OCTOBER TERM, 1937. Opinion of the Court. 303 U. S. mit the introduction of that proof. The failure so pointed out is analogous,” the court said, “to a case where there is proof without pleading, and the rule is that ‘pleading without proof or proof without pleading’ are each un-available.” On pétition for rehearing, the motion which had been omitted from the record was brought to the attention of the Court of Appeals. Rehearing was denied. On pétition to this Court for certiorari the parties stipulated that the motion to set aside the indictment as filed by petitioner in the trial court might be read and considered as a proper part of the record. Certiorari was granted. On argument at this bar, the Attorney General of the State expressly disclaimed reliance upon the omission from the original record on appeal of the motion to set aside the indictment, as the fact of the motion had been brought to the attention of the Court of Appeals upon the application for rehearing, and conceded that if the facts set forth in the affidavits submitted upon that motion were sufficient to show a déniai of constitutional right, the judgment should be reversed. We are of the opinion that the affidavits, which by the stipulation of the State were to be taken as proof, and were uncontroverted, sufficed to show a systematic and arbitrary exclusion of Negroes from the jury lists solely because of their race or color, constituting a déniai of the equal protection of the laws guaranteed to petitioner by the Fourteenth Amendment. Neal v. Delaware, 103 U. S. 370, 397; Carter v. Texas, 177 U. S. 442, 447; Norris N. Alabama, 294 U. S. 587. The judgment is reversed and the cause is remand-ed for further proceedings not inconsistent with this opinion. Reversed. Mr. Justice Cardozo took no part in the considération and decision of this case. DECISIONS PER CURIAM, ETC., FROM JANUARY 18, 1938, THROUGH APRIL 11, 1938.* No. —, original. Ex parte E. R. Lindsey. January 31, 1938. The motion for leave to file pétition for writ of mandamus is denied. No. —, original. Ex parte Albert B. Bleecker. January 31, 1938. Motion for leave to file pétition for writ of habeas corpus denied. No- —, original. Ex parte Peter Gibbons. January 31, 1938. Motion for leave to file pétition for writ of habeas corpus denied. No. 636. Electric Bond & Share Co. et al. v. Secu-rities and Exchange Commission et al. January 31, 1938. Jerome N. Frank and John W. Hanes, members of the Securities and Exchange Commission, substituted as parties respondent in the place of James M. Tandis and James D. Ross, resigned, on motion of Assistant Solicitor General Bell in that behalf. Reported below: 92 F. 2d 580. No. 730. Cosman v. United States. On pétition for writ of certiorari to the Circuit Court of Appeals for the Second Circuit. Decided February 7, 1938. Per Curiam: The motion for leave to proceed in forma pauperis is *Mr. Justice Cardozo was absent from the bench, on account of illness, during the period covered by this volume. For decisions on applications for certiorari, see post, pp. 628, 634; for rehearing, post, p. 665. 617 618 OCTOBER TERM, 1937. Decisions Per Curiam, Etc. 303 U. S. granted. The pétition for writ of certiorari is also granted, and the judgment is reversed. Frad v. Kelly, 302 U. S. 312. Mr. Myron G. Ehrlich for petitioner. No appear-ance for the United States. Reported below: 94 F. 2d 1020. No. 346. Helvering, Commissioner of Internal Revenue, v. Bowers, Administratrix. Certiorari, 302 U. S. 670, to the Circuit Court of Appeals for the Seventh Circuit. Argued February 1, 2, 1938. Decided February 7, 1938. Per Curiam: The judgment is reversed upon the authority of Tyler v. United States, 281 U. S. 497. Mr. Justice Cardozo and Mr. Justice Reed took no part in the considération or decision of this case. Mr. Andrew D. Sharpe, with whom Solicitor General Reed, Assistant Attorney General Morris, and Messrs. Sewall Key and Morton K. Rothschild were on the brief, for petitioner. Mr. Jay E. Darlington, with whom Mr. William N. Had-dad was on the brief, for respondent. By leave of Court, Mr. John E. Hughes filed a brief as amicus curiae, in support of respondent. Reported below: 90 F. 2d 790. No. 469. Foster, Executrix, v. Commissioner of Internal Revenue. Certiorari, 302 U. S. 678, to the Circuit Court of Appeals for the Ninth Circuit. Argued February 2, 1938. Decided February 7, 1938. Per Curiam: The judgment is affirmed. Tyler v. United States, 281 U. S. 497; Gwinn v. Commissioner, 287 U. S. 224. Mr. Justice Cardozo and Mr. Justice Reed took no part in the considération or decision of this case. Mr. Philip G. Sheehy for petitioner. Mr. Andrew D. Sharpe, with whom Solicitor General Reed, Assistant Attorney General Morris, and Messrs. Sewall Key, Norman D. Keller, and Lee A. Jackson were on the brief, for respondent. By OCTOBER TERM, 1937. 619 303 U. S. Decisions Per Curiam, Etc. leave of Court, Mr. W. H. Morrissey filed a brief on behalf of the San Mateo County Title Co., as amicus curiae, in support of petitioner. Reported below: 90 F. 2d 486. No. —, original. Ex parte Bryant McQuillen et al. February 7, 1938. Motions for leave to file pétitions for writs of mandamus and prohibition denied. The Chief Justice and Mr. Justice Stone took no part in the considération or decision of these applications. No. —, original. Ex parte Charles E. Phillips. February 7, 1938. Motion for leave to file pétition for writ of habeas corpus denied. No. —, original. Ex parte Andrew B. Young. February 7, 1938. Motion for leave to file pétition for de-claratory judgment denied. No. 748. Poole v. Florida. Appeal from the Suprême Court of Florida. Decided February 14, 1938. Per Curiam: The appeal herein is dismissed for the reason that the judgment sought to be reviewed is based upon a non-federal ground adéquate to support it. Quong Ham Wah Co. v. Industrial Commission, 255 U. S. 445, 448, 449; Hebert n. Louisiana, 272 U. S. 312, 316, 317; Susquehanna Co. v. Tax Commission (No. 2) 283 U. S. 297, 299, 300; Liggett & Myers Tobacco Co. v. South Carolina, 291 U. S. 652. The motion for leave to proceed further in forma pauperis is denied. Mr. W. D. Bell for appellant. No appearance for appellee. Reported below: 129 Fia. 841; 177 So. 195. 620 OCTOBER TERM, 1937. Decisions Per Curiam, Etc. 303 U. S. No. —, original. Ex parte Elbert Elwood Cogg. February 14, 1938. Motion for leave to file pétition for writ of habeas corpus denied. No. 123. Adams, Receiver, v. Nagle et al.; and No. 124. Same v. Tobias et al. February 14, 1938. Restored to the docket and assigned for reargument. Messrs. Brice Clagett, Charles E. Wainwright, Charles W. Matten and George P. Barse for petitioner. Messrs. Edward W. Madeira, Lemuel B. Schofield and W. Bradley Ward for respondents. Reported below: 88 F. 2d 936. No. 738. Mooney v. Smith, Warden. Pétition for writ of certiorari to the Suprême Court of California. February 14,1938. The petitioner having withdrawn the motion for leave to proceed on a printed abstract of the record and having moved for time to présent a brief in support of a pétition for certiorari, the latter motion is granted, and it is ordered that petitioner hâve thirty days from this date in which to file with this Court and serve upon respondent a brief in support of the pétition for certiorari, and that respondent hâve thirty days after such filing and service to file with the Court and serve upon petitioner an opposing brief. The parties may refer to the typewritten record in the respective briefs above men-tioned. Questions in relation to the préparation and printing of the record or abstracts thereof will be reserved until the coming in of such briefs. Messrs. Frank P. Walsh, John F. Finerty and George T. Davis for petitioner. Messrs. U. S. Webb, Attorney General, and William F. Cleary, Deputy Attorney General, of California, for respondent. Reported below : 73 F. 2d 554. 303 U. S. OCTOBER TERM, 1937. Decisions Per Curiam, Etc. 621 No. 768. Rust v. Pratt, Sheriff, et al.; No. 769. Jennings v. Same; No. 770. Abbott v. Same; and No. 771. Tigert v. Same. Appeals from the Suprême Court of Oregon. Decided February 28, 1938. Per Curiam: The appeals herein are dismissed (1) for the reason that the judgments sought to be reviewed are based upon a non-federal ground adéquate to support them, Doyle v. Atweïl, 261 U. S. 590; Cox v. Colorado, 282 U. S. 807; Woolsey N. Best, 299 U. S. 1; (2) for the want of a substantial fédéral question, Twining v. New Jersey, 211 U. S. 78, 106, 111-114; Snyder N. Massachusetts, 291 U. S. 97, 105; Brown v. Mississippi, 297 U. S. 278, 285; Palko N. Connecticut, 302 U. S. 319. Mr. Mortimer Riemer for appellants. No appearance for appel-lees. Reported below: 157 Ore. 505; 72 P. 2d 533. No. 792. Williams et al. v. Quill, President of the Transport Workers Union of America, et al. Appeal from the Suprême Court of New York. Decided February 28, 1938. Per Curiam: The motion of the appellants for leave to file supplémentai statement as to jurisdiction is granted. The motion of the appellees to dismiss the appeal is granted, and the appeal is dismissed for the want of a final judgment. Verden v. Coleman, 18 How. 86; Reddall v. Bryan, 24 How. 420, 422; Bran-nan v. Harrison, 284 U. S. 579. Mr. Nathan W. Math for appellants. Messrs. Harold Sacher and George D. Yeomans for appellees. Reported below: 277 N. Y. 1; 12 N. E. 547; 1 N. Y. S. 2d 507. No. —, original. Ex parte Walter Gross. February 28, 1938. Motion for leave to file pétition for writ of habeas corpus denied. 622 OCTOBER TERM, 1937. Decisions Per Curiam, Etc. 303 U. S. No. 897, October Term 1936. McDonald v. United States. February 28, 1938. The pétition for a writ of error coram nobis is denied. Mr. Justice Reed took no part in the considération or decision of this application. See 301 U. S. 697; 302 U. S. 773. No. 753. Groves et al. v. Board of Education of Chicago. Appeal from the Suprême Court of Illinois. Decided March 7, 1938. Per Curiam: The motion of the appellee to dismiss the appeal is granted and the appeal is dismissed (1) for the want of a final judgment, Bost-wick v. Brinkerhoff, 106 U. S. 3; Cotton v. Hawaii, 211 U. S. 162, 170; Georgia Ry. Co. N. Decatur, 262 U. S. 432, 437; (2) for the want of a substantial fédéral question, Phelps v. Board of Education, 300 U. S. 319; Dodge n. Board of Education, 302 U. S. 74. Mr. John E. Groves and Mary E. Stanton, pro se. Messrs. Richard S. Fol-som, Frank S. Righeimer, Ralph W. Condes, and Frank R. Schneberger for appellee. Reported below: 367 111. 91; 10N. E. 2d 403. No. 778. Adler et al. v. Cincinnati et al. Appeal from the Suprême Court of Ohio. Decided March 7, 1938. Per Curiam: The motion of the appellees to dismiss the appeal is granted and the appeal is dismissed for the want of a substantial fédéral question. Bélling-ham Bay & B. C. R. Co. n. New Whatcom, 172 U. S. 314, 320; Ballard v. Hunter, 204 U. S. 241, 262; North Laramie Land Co. v. Hoffman, 268 U. S. 276, 283; Witzelberg v. Cincinnati, 302 U. S. 635. Mr. Edward M. Ballard for appellants. Mr. John D. Ellis for appellees. Reported below: 133 Ohio St. 129; 12 N. E. 2d 288. 303 U. S. OCTOBER TERM, 1937. Decisions Per Curiam, Etc. 623 No. 366. Kansas Farmers Union Royalty Co. et al. v. Shaffer, Executor, et al. Appeal from the Suprême Court of Kansas. Argued February 2, 1938. Decided March 7, 1938. Per Curiam: As it appears, after hearing argument, that there is no properly presented fédéral question, the motion of the appellants to reinstate the case for further considération is denied and the appeal is dismissed. Clarke v. McDade, 165 U. S. 168, 172; Chesa-peake & Ohio Ry. Co. v. McDonald, 214 U. S. 191, 193; Hiawassee Power Co. v. Carolina-Tenn. Co., 252 U. S. 341, 343; Witzelberg v. Cincinnati, 302 U. S. 635. Mr. L. E. Cle venger, with whom Messrs. B. I. Litowich and S. H. King were on the brief, for appellants. Mr. D. M. McCarthy, Kathryn O’Loughlin McCarthy, and Mr. Oscar Ostrum were on the brief for appellees. Reported below : 146 Kan. 84; 69T. 2d 4. No. 427. Szold v. Outlet Embroidery Supply Co. Appeal from the Suprême Court of New York. Argued February 28,1938. Decided March 7,1938. Per Curiam: As it appears, after hearing argument, that no substantial fédéral question is involved, the appeal is dismissed. (1) Dent v. West Virginia, 129 U. S. 114, 122, 123; Watson v. Maryland, 218 U. S. 173, 176, 177; Semler v. Dental Ex-aminers, 294 U. S. 608, 611, 612; (2) Second Employers’ Liability Cases, 223 U. S. 1, 52; New York Central R. Co. v. White, 243 U. S. 188, 207; (3) Liebermann v. Van De Carr, 199 U. S. 552, 562; Douglas v. Noble, 261 U. S. 165, 168, 169; Highland Farms Dairy v. Agnew, 300 U. S. 608, 612. Messrs. Eugene L. Garey and Earl J. Garey submitted the cause on brief for appellant. Mr. Henry Epstein, Solicitor General, with whom Mr. John J. Bennett, Jr., Attorney General, of New York, was on the brief, for appellee. Reported below: 274 N. Y. 271; 248 App. Div. 865; 8 N. E. 2d 858; 291 N. Y. S. 395. 624 OCTOBER TERM, 1937. Decisions Per Curiam, Etc. 303 U. S. No. —, original. Ex parte Howard Lee. March 7, 1938. The motion for leave to file a pétition for writ of habeas corpus is denied without préjudice to appropriate application for review of the judgment of the Suprême Court of California on writ of certiorari or appeal. Urqu-hart v. Brown, 205 U. S. 179, 182, 183. No. 817. Kansas Gas & Electric Co. v. McPherson et al. Appeal from the Suprême Court of Kansas. De-cided March 14, 1938. Per Curiam: The motion of the appellees to dismiss the appeal is granted and the appeal is dismissed for the want of a substantial fédéral question. Springfield Gas Co. v. Springfield, 257 U. S. 66; Puget Sound Co. v. Seattle, 291 S. 619, 624, 625. Messrs. Henry L. McCune and Blatchford Downing for appellant. Messrs. William Drennan, J. Rodney Rhoades, and Claude I. Depew for appellees. Reported below: 146 Kan. 614; 72 P. 2d 985. No. 822. Hering et al. v. State Board of Education. Appeal from the Court of Errors and Appeals of New Jersey. Decided March 14, 1938. Per Curiam: The appeal is dismissed for the want of a substantial fédéral question. Hamilton n. Regents, 293 U. S. 245, 261, 262; Coale v. Pearson, 290 U. S. 597; Leoles v. Lan-ders, 302 U. S. 656. Messrs. Abraham J. Isserman, Martin Conboy, Osmond K. Fraenkel, Carol King, and Olin R. Moyle for appellants. No appearance for appellee. Reported below: 118 N. J. L. 566; 117 N. J. L. 455; 194 A. 177; 189 A. 629. No. 558. Sharp et al. v. Commissioner of Intjernal Revenue. Certiorari, 302 U. S. 680, to the Circuit Court of Appeals for the Third Circuit. Argued March 9, 1938. OCTOBER TERM, 1937. 625 303 U. S. Decisions Per Curiam, Etc. Decided March 14, 1938. Per Curiam: The judgment is reversed. Freuler v. Helvering, 291 U. S. 35, 43, 45; Blair v. Commissioner, 300 U. S. 5, 9, 10. Mr. William Barclay Lex, with whom Mr. Charles C. Norris, Jr. was on the brief, for petitioners. Mr. A. F. Prescott argued the cause, and Acting Solicitor General Bell was on a mémorandum, for respondent. Reported below: 91 F. 2d 802. No. —, original. Ex parte Jesse C. Duke. March 14, 1938. Motion for leave to file pétition for writ of habeas corpus denied. No. —, original. Ex parte Nat J. Humphries. March 14, 1938. Motion for leave to file pétition for writ of habeas corpus denied. No. 13. United Gas Public Service Co. v. Texas et al. March 14, 1938. It is ordered that the opinion in this cause be amended by striking out the period after the words “and return” in line 3, on page 14, and inserting the words “for the period to which the evidence before the Court appropriately related and not simply for the years 1932 and 1933.” The pétition for rehearing is denied. Reported as amended, ante, p. 123. No. 161. South Carolina State Highway Dept. et al. v. Barnwell Brothers, Inc., et al. March 14, 1938. It is ordered that the opinion in this cause be amended by substituting for the words “But as the district court held,” in the last sentence of the last full paragraph on page 4 of the opinion, the following words: “But appellees do not challenge here the ruling of the district court that.” The pétition for rehearing is denied. Reported as amended, ante, p. 177. 53383°—38----------40 626 OCTOBER TERM, 1937. Decisions Per Curiam, Etc. 303 U. S. Order. March 14, 1938. In view of pending législation General Order No. LUI in Bankruptcy is hereby suspended until further order of the Court. No. 840. Edgar Brothers Co. v. State Revenue Commission et al. Appeal from the Suprême Court of Geor-gia. Decided March 28, 1938. Per Curiam: The motion of the appellees to dismiss the appeal is granted and the appeal is dismissed for the want of a final judgment. California National Bank v. Stateler, 171 U. S. 447, 449; Haseltine v. Central Bank of Springfield (No. 1), 183 U. S. 130, 131; Bruce v. Tobin, 245 U. S. 18; Mississippi Central R. Co. v. Smith, 295 U. S. 718. Mr. Orville A. Park for appellant. Messrs. M. J. Yeomans and O. H. Dukes for appellees. Reported below: 185 Ga. 216; 194 S. E. 505. No. 857. Kirkpatrick v. Hardt. On pétition for writ of certiorari to the Circuit Court of Appeals for the Ninth Circuit. Decided March 28, 1938. Per Curiam: The motion for leave to proceed further herein in forma pauperis is denied for the reason that the Court, upon examination of the papers herein submitted, finds that the application for writ of certiorari was not made within the time provided by law. Act of February 13, 1925, sec. 8 (a) (43 Stat. 936, 940). Finn v. Railroad Commission, 286 U. S. 559; Cresswell &c. v. Tillinghast, 286 U. S. 560. The pétition for writ of certiorari is therefore also denied. Mr. James Martin Kirkpatrick, pro se. No appearance for respondent. Reported below: 91 F. 2d 857. No. —, original. Ex parte Albert R. House. March 28, 1938. The rule to show cause herein is discharged and the motion for leave to file pétition for writ of habeas corpus is denied. 303 U. S. OCTOBER TERM, 1937. Decisions Per Curiam, Etc. 627 No. —. The Silvershirt Légion of America, Inc. et al. v. Committee on Education and Labor of the United States Senate et al. March 28, 1938. The application for preliminary injunction pending application for writ of certiorari is denied. No. 847. Pope v. United States. March 28, 1938. Motion to remand to the Court of Claims for further find-ings denied. No. 871. Heller v. Connecticut. Appeal from the Suprême Court of Errors of Connecticut. Decided April 4, 1938. Per Curiam: The appeal herein is dismissed for the want of a substantial fédéral question. Mugler v. Kansas, 123 U. S. 623, 668-669; Réduction Company v. Sanitary Works, 199 U. S. 306, 324-325; Hudson Water Co. v. McCarter, 209 U. S. 349, 356; Perley v. North Carolina, 249 U. S. 510; Euclid v. Ambler Realty Co., 272 U. S. 365, 388, 389; West Brothers Brick Co. v. Alexandrie, 302 U. S. 658. Mr. Nathan April for appellant. No appearance for appellee. Reported below: 123 Conn. 492; 196 A. 337. No. 892. Allbritton et al. v. Winona. Appeal from the Suprême Court of Mississippi. Decided April 4, 1938. Per Curiam: The appeal herein is dismissed for the want of a substantial fédéral question. Jones v. Portland, 245 U. S. 217; Green v. Frazier, 253 U. S. 233; Milheim v. Mofiat Tunnel Dist., 262 U. S. 710, 717; Carmichael N. Southern Coal Co., 301 U. S. 495, 514, 515. Mr. W. E. Morse for appellants. No appearance for respondent. Reported below: 181 Miss. 75; 178 So. 799. No. —, original. Ex parte Mike J. Lindway. April 4, 1938. Motion for leave to file pétition for writ of habeas corpus denied. 628 OCTOBER TERM, 1937. Decisions Granting Certiorari. 303 U. S. No. —, original. Ex parte J. R. Palmer. April 4, 1938. Motion for leave to file pétition for writ of habeas corpus denied. No. 16, original. Missouri v. Iowa. April 4, 1938. The answer of the défendant is received and ordered filed. No. 805. Indiana ex rel. Valentine v. Marker, Trustée. On pétition for writ of certiorari to the Suprême Court of Indiana. Decided April 11, 1938. Per Curiam: The pétition for writ of certiorari is granted and the judgment is reversed upon the authority of Indiana ex rel. Anderson v. Brand, ante, p. 95. Mr. Justice Black dissents. Messrs. Paul R. Shafer and Thomas F. O’Mara for petitioner. No appearance for respondent. Reported below: 213 Ind. —; 8 N. E. 2d 231. No. —. Palka v. Walker, Warden. April 11, 1938. The application for stay of execution pending filing of pétition for writ of certiorari is denied. DECISIONS GRANTING CERTIORARI, FROM JANUARY 18, 1938, THROUGH APRIL 11, 1938. No. 647. Bâtes Manufacturing Co. v. United States. January 31, 1938. Petiton for writ of certiorari to the Circuit Court of Appeals for the First Circuit granted. Messrs. Charles B. Rugg, F. Brian Holland, and Warren F. Farr for petitioner. Solicitor General Reed, Assistant Attorney General Morris, and Messrs. Sewall Key and F. E. Youngman for the United States. By leave of Court, Messrs. Théodore B. Benson and John Jennings, Jr. filed a brief on behalf of Pinnacle Mills, as amicus curiae, in support of petitioner. Reported below: 93 F. 2d 721. OCTOBER TERM, 1937. 629 303 U. S. Decisions Granting Certiorari. No. 680. Hale v. Kentucky. January 31, 1938. Motion for leave to proceed in forma pauperis granted. Pétition for writ of certiorari to the Court of Appeals of Kentucky also granted. Messrs. Charles H. Houston and Leon A. Ransom for petitioner. No appearance for respondent. Reported below: 269 Ky. 743; 108 S. W. 2d 716. No. 730. Cosman v. United States. See ante, p. 617. No. 699. Johnson v. Zerbst, Warden. February 14, 1938. Pétition for writ of certiorari to the Circuit Court of Appeals for the Fifth Circuit granted. Mr. Elbert P. Tuttle for petitioner. Acting Solicitor General Bell, As-sistant Attorney General McMahon, and Messrs. William W. Barron, Bâtes Booth, and W. Marvin Smith for respondent. Reported below : 92 F. 2d 748. No. 667. United States v. Kaplan. February 14, 1938. Pétition for writ of certiorari to the Court of Claims granted. Mr. Justice Reed took no part in the considération or decision of this application. Solicitor General Reed for the United States. Mr. Llewellyn A. Luce for respondent. Reported below: 85 Ct. Cls. 158; 18 F. Supp. 965. No. 668. United States v. Shoshone Tribe of In-dians. February 14, 1938. Pétition for writ of certiorari to the Court of Claims granted. Mr. Justice Stone and Mr. Justice Reed took no part in the considération or decision of this application. Solicitor General Reed for the United States. Messrs. George M. Tunison, Charles J. Kappler and Albert W. Jefferis for respondent. Reported below: 85 Ct. Cls. 331. 630 OCTOBER TERM, 1937. Decisions Granting Certiorari. 303 U. S. Nos. 715 and 716. Wright v. Union Central Life Ins. Co. February 28, 1938. Pétition for writs of certiorari to the Circuit Court of Appeals for the Seventh Circuit granted. Messrs. Samuel E. Cook, Wm, Lemke, Elmer McClain and Ray M. Foreman for petitioner. Messrs. Arthur S. Lytton, Louis M. Mantynband, Stanley K. Henshaw, and Virgil D. Parish for respondent. Reported below: 91 F. 2d 894. No. 706. National Labor Relations Board v. Mackay Radio & Telegraph Co. February 28, 1938. Pétition for writ of certiorari to the Circuit Court of Appeals for the Ninth Circuit granted. Mr. Justice Reed took no part in the considération or decision of this application. Solicitor General Reed and Mr. Charles Fahy for petitioner. Messrs. H. W. OMelveny and Howard L. Kern for respondent. Reported below: 87 F. 2d 611; 92 F. 2d 761. No. 723. Helvering, Commissioner of Internal Revenue, v. National Grocery Co. February 28, 1938. Pétition for writ of certiorari to the Circuit Court of Appeals for the Third Circuit granted. Mr. Justice Reed took no part in the considération or decision of this application. Solicitor General Reed for petitioner. Messrs. Edwin F. Smith and James D. Carpenter, Jr. for respondent. Reported below : 92 F. 2d 931. No. 779. Helvering, Commissioner of Internal Revenue, v. Gerhardt; No. 780. Same v. Wilson; and No. 781. Same v. Mulcahy. February 28, 1938. Pétition for writs of certiorari to the Circuit Court of Ap- 303 U. S. OCTOBER TERM, 1937. Decisions Granting Certiorari. 631 peals for the Second Circuit granted. The Chief Justice took no part in the considération or decision of this application. Acting Soliciter General Bell for petitioner. Messrs. Julius Henry Cohen and Austin J. Tobin for respondents. Reported below: 92 F. 2d 999. No. 746. Taft, Executor, v. Commissioner of In-ternal Revenue. March 7, 1938. Pétition for writ of certiorari to the Circuit Court of Appeals for the Sixth Circuit granted. Mr. Robert A. Taft for petitioner. Acting Solicitor General Bell, Assistant Attorney General Morris, and Mr. J. Louis Monarch and Louise Foster for respondent. Reported below: 92 F. 2d 667. No. 756. Fédéral Trade Commission v. Goodyear Tire & Rubber Co. March 7, 1938. Pétition for writ of certiorari to the Circuit Court of Appeals for the Sixth Circuit granted. Mr. Justice Stone and Mr. Justice Reed took no part in the considération or decision of this application. Acting Solicitor General Bell for petitioner. Mr. William B. Cockley for respondent. Reported below: 92 F. 2d 677. No. 773. Aetna Insurance Co. v. United Fruit Co. ; No. 774. Union Marine & General Ins. Co. v. Same; and No. 775. Boston Insurance Co. v. Same. March 14, 1938. Pétition for writs of certiorari to the Circuit Court of Appeals for the Second Circuit granted. Messrs. D. Roger Englar, T. Catesby Jones, Oscar R. Houston, and Martin Detels for petitioners. Messrs. Cletus Keating and Richard Sullivan for respondent. Reported below : 92 F. 2d 576. 632 OCTOBER TERM, 1937. Decisions Granting Certiorari. 303 U. S. No. 796. Coleman et al. v. Miller, Secretary, et al. March 28, 1938. Pétition for writ of certiorari to the Suprême Court of Kansas granted. Mr. Robert Stone for petitioners. By leave of Court, Attorney General Cummings filed a mémorandum on behalf of the United States as amicus curiae, in support of the decision below. Reported below: 146 Kan. 390; 71 P. 2d 518. No. 802. Great Northern Railway Co. et al. v. Leonidas. March 28, 1938. Pétition for writ of certiorari to the Suprême Court of Montana granted. Messrs. R. E. L. Smith and Taylor B. Weir for petitioners. Mr. Lester H. Loble for respondent. Reported below: 105 Mont. 302; 72 P. 2d 1007. No. 811. Guaranty Trust Co., Executor, v. Virginia. March 28, 1938. Pétition for writ of certiorari to the Suprême Court of Appeals of Virginia granted. Mr. Jas. R. Caskie for petitioner. Messrs. Abram P. Staples, W. W. Martin, and Henry R. Miller, Jr. for respondent. Reported below: 169 Va. 414; 193 S. E. 534. No. 814. Valli et al. v. United States. March 28, 1938. Pétition for writ of certiorari to the Circuit Court of Appeals for the First Circuit granted. Mr. Essex S. Abbott for petitioners. Solidtor General Jackson, As-sistant Attorney General McMahon, and Messrs. William W. Barron and W. Marvin Smith for the United States. Reported below: 94 F. 2d 687. No. 782. Zerbst, Warden, v. Kidwell; No. 783. Same v. Smith; No. 784. Same v. Collins; OCTOBER TERM, 1937. 633 303 U. S. Decisions Granting Certiorari. No. 785. Same v. Owens; No. 786. Same v. Peel; No. 787. Same v. Jones; No. 788. Same v. Stone; and No. 789. Same v. Sullivan. March 28, 1938. Pétition for writs of certiorari to the Circuit Court of Appeals for the Fifth Circuit granted. Mr. Justice Reed took no part in the considération or decision of this application. Acting Soliciter General Bell for petitioner. Mr. J. F. Kemp for respondents. Reported below: 92 F. 2d 756. No. 815. United States v. One 1936 Model Ford. April 4, 1938. Pétition for writ of certiorari to the Circuit Court of Appeals for the Fourth Circuit granted. Mr. Justice Butler and Mr. Justice Stone took no part in the considération or decision of this application. Acting Soliciter General Bell for the United States. Messrs. Duane R. Dills and Eugene E. Heaton for respondent. Reported below: 93 F. 2d 771. No. 805. Indiana ex rel. Valentine v. Marker. Trustée. See ante, p. 628. No. 860. Helvering, Commissioner of Internal Revenue, v. Winmill. April 11, 1938. Pétition for writ of certiorari to the Circuit Court of Appeals for the Second Circuit granted. Soliciter General Jackson for petitioner. Mr. Thomas M. Wilkins for respondent. Reported below : 93 F. 2d 494. No. 864. Lowe Brothers Co. v. United States. April 11, 1938. Pétition for writ of certiorari to the Circuit Court of Appeals for the Sixth Circuit granted. 634 OCTOBER TERM, 1937. Decisions Denying Certiorari. 303 U. S. Messrs. William Cogger and John E. Hughes for petitioner. Solicitor General Jackson for the United States. Reported below : 92 F. 2d 905. No. 882. Allen, Collector of Internal Revenue, v. Regents of the University System of Georgia. April 11, 1938. Pétition for writ of certiorari to the Circuit Court of Appeals for the Fifth Circuit granted. Solicitor General Jackson for petitioner. Messrs. M. J. Yeomans, Marion Smith, M. E. Kilpatrick, and Hamïlton Lokey for respondents. Reported below : 93 F. 2d 887. No. 902. Chandler et al. v. Wise et al. April 11, 1938. Pétition for writ of certiorari to the Court of Appeals of Kentucky granted. Mr. J. W. Jones for petitioners. Messrs. Lafon Allen and Oldham Clarke for respondents. Reported below: 270 Ky. 1; 108 S. W. 2d 1024. DECISIONS DENYING CERTIORARI, FROM JANUARY 18, 1938, THROUGH APRIL 11, 1938. No. 684. Pollitt v. Cox; and No. 736. Same v. Wheat. January 31, 1938. Pétitions for writs of certiorari to the Court of Appeals for the District of Columbia, and motions for leave to pro-ceed further in forma pauperis, denied. Basil H. Pollitt, pro se. Reported below: See 68 App. D. C. 90; 93 F. 2d 249. No. 711. Hill v. Railroad Industrial Finance Co. et al. January 31, 1938. Pétition for writ of certiorari to the Circuit Court of Appeals for the Tenth Circuit, and motion for leave to proceed further in forma pauperis, denied. Mr. Robert L. Hill, pro se. Reported below : 93 F. 2d 973. a 303 U. S. OCTOBER TERM, 1937. Decisions Denying Certiorari. 635 No. 725. Bostic v. United States. January 31, 1938. Pétition for writ of certiorari to the Court of Appeals for the District of Columbia, and motion for leave to pro-ceed further in forma pauperis, denied. Mr. Sol M. Alpher for petitioner. No appearance for the United States. Reported below: 94 F. 2d 636. No. 649. Harding v. Kentucky Title Trust Co. January 31, 1938. Motion for supersedeas denied. Pétition for writ of certiorari to the Court of Appeals of Kentucky also denied. Mr. Colescott P. Harding, pro se. Mr. Shackelford Miller, Jr. for respondent. Reported below: 269 Ky. 622; 108 S. W. 2d 539. No. 634. Van Riper v. United States. January 31, 1938. Pétition for writ of certiorari to the Circuit Court of Appeals for the Second Circuit denied. Mr. John S. Wise, Jr. for petitioner. Solicitor General Reed, Assistant Attorney General McMahon, and Messrs. William W. Barron and W. Marvin Smith for the United States. Reported below: 92 F. 2d 1020. No. 635. Clarke, Trustée v. Chicago, B. & Q. R. Co. January 31, 1938. Pétition for writ of certiorari to the Circuit Court of Appeals for the Tenth Circuit denied. Mr. Samuel Meyers for petitioner. Mr. J. C. James for respondent. Reported below : 91 F. 2d 635. No. 637. President of the United States ex rel. Caputo v. Kelly, U. S. Marshal, et al. January 31, 1938. Pétition for writ of certiorari to the Circuit Court of Appeals for the Second Circuit denied. Messrs. Lewis Landes and Julius I. Puente for petitioner. Messrs. John W. Davis, Théodore Kiendl and A. S. Edmonds for respondents. Reported below: 92 F. 2d 603. 636 OCTOBER TERM, 1937. Decisions Denying Certiorari. 303 U. S. No. 642. Fidelity-Phenix Pire Ins. Co. et al. v. Cortez Cîgar Co. ; and No. 650. Cortez Cigar Co. v. Fidelity-Phenix Fire Ins. Co. et al. January 31, 1938. Pétitions for writs of certiorari to the Circuit Court of Appeals for the Fifth Circuit denied. Messrs. Dan MacDougald and Anton P. Wright for petitioners in No. 642, and respondents in No. 650. Messrs. A. R. Lawton, Jr. and T. M. Cunningham for the Cortez Cigar Co. Reported below: 92 F. 2d 882. No. 644. Isackson v. School District No. 37. January 31, 1938. Pétition for writ of certiorari to the Circuit Court of Appeals for the Ninth Circuit denied. Mr. John Lichty for petitioner. Mr. K. C. Tanner for respondent. Reported below : 92 F. 2d 768. No. 648. Goldberg v. McCauley, Warden. January 31, 1938. Pétition for writ of certiorari to the Circuit Court of Appeals for the Ninth Circuit denied. Mr. Samuel B. Bassett for petitioner. No appearance for respondent. Reported below: 91 F. 2d 1016. No. 656. Logan, Trustée in Bankruptcy, v. Stano-lind Oil & Gas Co. et al. January 31, 1938. Pétition for writ of certiorari to the Circuit Court of Appeals for the Fifth Circuit denied. Mr. John T. Pearson for petitioner. No appearance for respondents. Reported below : 92 F. 2d 28. No. 661. Cochrane v. United States; and No. 662. Fellows v. United States. January 31, 1938. Pétition for writs of certiorari to the Circuit Court of Appeals for the Seventh Circuit denied. Messrs. 303 U. S. OCTOBER TERM, 1937. Decisions Denying Certiorari. 637 Leslie G. Pefferle and Roswell B. O’Harra for petitioners. Acting Soliciter General Bell, Assistant Attorney General McMahon, and Messrs. William W. Barron and W. Marvin Smith for the United States. By leave of Court, briefs of amici curiae were filed by Mr. Gurney E. Newlin, on behalf of the Cerritos Gun Club et al., and by Mr. Bennett Sanderson, on behalf of the Massachusetts Waterfowlers’ Assn., in support of petitioners. Reported below: 92 F. 2d 623. No. 665. J. A. Livingston, Inc., v. Pocono Rubber Cloth Co. January 31, 1938. Pétition for writ of certiorari to the Circuit Court of Appeals for the Third Circuit denied. Messrs. Abraham Shamos and Milton E. Mer-melstein for petitioner. Mr. T. Hart Anderson for respondent. Reported below : 92 F. 2d 290. No. 669. Hipp, Trustée in Bankruptcy, v. Boyle, Treasurer. January 31, 1938. Pétition for writ of certiorari to the Circuit Court of Appeals for the Sixth Circuit denied. Mr. Merritt A. Vickery for petitioner. Mr. Frederick W. Green for respondent. Reported below : 92 F. 2d 338. No. 722. Keller v. Zerbst, Warden. February 7, 1938. Pétition for writ of certiorari to the Circuit Court of Appeals for the Fifth Circuit, and motion for leave to proceed further in forma pauperis, denied. John Keller, pro se. No appearance for respondent. 97 F. 2d 257. No. 654. McQuillen et al. v. Coleman, Judge. February 7, 1938. Pétition for writ of certiorari to the Circuit Court of Appeals for the Fourth Circuit denied. The 638 OCTOBER TERM, 1937. Decisions Denying Certiorari. 303 U. S. Chief Justice and Me. Justice Stone took no part in the considération or decision of this application. Mr. Samuel Gottlieb for petitioners. Mr. James Piper for respondent. Reported below: 93 F. 2d 1009. No. 681. Moulding-Brownell Corp. v. Sullivan et al. February 7, 1938. Pétition for writ of certiorari to the Circuit Court of Appeals for the Seventh Circuit denied. Employers Corporation v. Bryant, 299 U. S. 374. Mr. James J. Magner for petitioner. Mr. Harold R. Schradzke for respondents. Reported below: 92 F. 2d 646. No. 657. Security-First National Bank, Trustée, v. Welch, Former Collector of Internal Revenue. February 7, 1938. Pétition for writ of certiorari to the Circuit Court of Appeals for the Ninth Circuit denied. Messrs. Dana Latham and George Bouchard for petitioner. Solidtor General Reed, Assistant Attorney General Morris, and Messrs. Sewall Key and Harry Marselli for respondent. Reported below: 92 F. 2d 357. No. 666. Abbott, Administratrix, v. Morgenthau, Secretary of the Treasury, et al. February 7, 1938. Pétition for writ of certiorari to the Court of Appeals for the District of Columbia denied. Messrs. F. Eberhart Haynes and Thomas E. Rhodes for petitioner. Acting Solidtor General Bell, Assistant Attorney General Whit-aker, and Mr. Henry A. Julicher for respondents. Reported below: 68 App. D. C. 83; 93 F. 2d 242. No. 677. Dip v. United States. February 7, 1938. Pétition for writ of certiorari to the Circuit Court of Appeals for the Ninth Circuit denied. Mr. Raymond T. 303 U. S. OCTOBER TERM, 1937. Decisions Denying Certiorari. 639 Coughlin for petitioner. Acting Solicitor General Bell, Assistant Attorney General McMahon, and Mr. William W. Barron for the United States. Reported below: 92 F. 2d 802. No. 686. Cudahy Packing Co. v. McBride. February 7, 1938. Pétition for writ of certiorari to the Circuit Court of Appeals for the Eighth Circuit denied. Messrs. J. A. C. Kennedy and Ralph E.' Svoboda for petitioner. Messrs. Wymer Dressler and Robert D. Neely for respondent. Reported below : 92 F. 2d 737. No. 745. New York ex rel. Geiselman v. Hunt, Warden. February 14, 1938. Pétition for writ of certiorari to the Wyoming County Court, of New York, and motion for leave to proceed further in forma pauperis, denied. Samuel L. Geiselman, pro se. No appearance for respondent. Reported below: 275 N. Y. 612; 11 N. E. 2d 781. No. 672. Levey v. United States. February 14, 1938. Pétition for writ of certiorari to the Circuit Court of Appeals for the Ninth Circuit denied. Mr. John F. Garvin for petitioner. Acting Solicitor General Bell, Assistant Attorney General McMahon, and Mr. William W. Barron for the United States. Reported below: 92 F. 2d 688. No. 674. Schriber-Schroth Co. v. Cleveland Trust Co. ET AL. ; No. 675. Aberdeen Motor Supply Co. v. Same; and No. 676. F. E. Rowe Sales Co. v. Same. February 14, 1938. Pétition for writs of certiorari to the Circuit Court of Appeals for the Sixth Circuit denied. Messrs. 640 OCTOBER TERM, 1937. Decisions Denying Certiorari. 303 U. S. Thomas G. Haight, George L. Wilkinson, John H. Brun-inga, and John H. Sutherland for petitioners. Messrs. A. C. Denison, F. O. Richey and Wm. C. McCoy for re-spondents. Reported below: 92 F. 2d 330. No. 679. Carter v. Marvel Carburetor Co. February 14, 1938. Pétition for writ of certiorari to the Suprême Court of Michigan denied. Mr. William C. Carter, pro se. Mr. Wilbur M. Brucker for respondent. Reported below: 281 Mich. 121; 274 N. W. 733. No. 682. Dutchess Underwear Corp. v. Industrial Rayon Corp. February 14, 1938. Pétition for writ of certiorari to the Circuit Court of Appeals for the Second Circuit denied. Mr. Asher Blum for petitioner. Mr. Inzer B. Wyatt, Jr. for respondent. Reported below: 92 F. 2d 33. No. 700. Pacific Gas & Electric Co. v. Sacramento Municipal Utility District et al. February 14, 1938. Pétition for writ of certiorari to the Circuit Court of Appeals for the Ninth Circuit denied. Messrs. Warren Olney Jr. and J. M. Mannon, Jr. for petitioner. Mr. Stephen W. Downey for respondents. Reported below: 92 F. 2d 365. No. 704. Chicago, B. & Q. R. Co. v. Goodman, Ad-ministratrix. February 14, 1938. Pétition for writ of certiorari to the Appellate Court, Ist District, of Illinois, denied. Mr. J. C. James for petitioner. Mr. Samuel Cohen for respondent. Reported below: 289 111. App. 320; 7 N. E. 2d 393. 303 U. S. OCTOBER TERM, 1937. Decisions Denying Certiorari. 641 No. 708. Danish, Trustée, v. Sofranski et au. February 14, 1938. Pétition for writ of certiorari to the Circuit Court of Appeals for the Second Circuit denied. Mr. Samuel C. Duberstein for petitioner. Mr. Louis J. Vorhaus for respondents. Reported below: 93 F. 2d 424. No. 712. Wabash Appliance Corp. et al. v. General Electric Co. February 14, 1938. Pétition for writ of certiorari to the Circuit Court of Appeals for the Second Circuit denied. Messrs. Samuel E. Darby, Jr. and Paul Kolisch for petitioners. Messrs. Hubert How s on and Merrell E. Clark for respondent. Reported below: 93 F. 2d 671. No. 721. Peerless Equipment Co. v. W. H. Miner, Inc. February 14, 1938. Pétition for writ of certiorari to the Circuit Court of Appeals for the Seventh Circuit denied. Messrs. Otto Raymond Barnett, George L. Wilkinson, and Rodney Bedell for petitioner. Mr. George I. Haight for respondent. Reported below: 93 F. 2d 98. No. 762. Belk v. Massman Construction Co. February 28, 1938. Pétition for writ of certiorari to the Suprême Court of Nebraska, and motion for leave to pro-ceed further in forma pauperis, denied. Mr. Cari F. Belk, pro se. No appearance for respondent. Reported below: 133 Neb. 303; 275 N. W. 76. No. 777. Pollitt v. Hall, Acting Superintendent. February 28, 1938. Pétition for writ of certiorari to the Court of Appeals for the District of Columbia, and motion for leave to proceed further in forma pauperis, denied. Basil H. Pollitt, pro se. No appearance for respondent. Reported below: 68 App. D. C. 90; 93 F. 2d 249. 53383°—38----------11 642 OCTOBER TERM, 1937. Decisions Denying Certiorari. 303 U. S. No. 791. Simpson et al. v. Dyer et al. February 28, 1938. Pétition for writ of certiorari to the Circuit Court of Appeals for the Sixth Circuit, and motion for leave to proceed further in forma pauperis, denied. George T. Simpson, pro se. No appearance for respondents. Reported below: 92 F. 2d 1016. No. 719. Pratt v. United States. February 28, 1938. Pétition for writ of certiorari to the Court of Appeals for the District of Columbia, and motion for leave to proceed further in forma pauperis, denied. Mr. James J. Laughlin for petitioner. No appearance for the United States. Reported below: 68 App. D. C. 106; 93 F. 2d 652. No. 799. Brown v. Brown. February 28, 1938. Pétition for writ of certiorari to the Superior Court of Pennsylvania, and motion for leave to proceed further in forma pauperis, denied. Mr. James Yearsley for petitioner. No appearance for respondent. Reported below: 124 Pa. Super. 237; 188 A. 389; 189 A. 711. No. 727. United States v. Baker et al. February 28, 1938. Pétition for writ of certiorari to the Circuit Court of Appeals for the Fifth Circuit denied. Mr. Justice Reed took no part in the considération or decision of this application. Acting Solicitor General Bell for the United States. Mr. A. G. Bush for respondents. Reported below: 93 F. 2d 332. No. 655. PlNK, SuPERINTENDENT OF INSURANCE, V. United States. February 28, 1938. Pétition for writ of certiorari to the Court of Claims denied. Messrs. Alfred C. Bennett and Benjamin Potoker for petitioner. Acting 303 U. S. OCTOBER TERM, 1937. Decisions Denying Certiorari. 643 Solicitor General Bell, Assistant Attorney General Whit-aker, and Mr. Paul A. Sweeney for the United States. Reported below: 85 Ct. Cls. 121. No. 660. Moran, Receiver, v. United States. February 28, 1938. Pétition for writ of certiorari to the Court of Claims denied. Messrs. Meredith M. Daubin and H. L. McCormick for petitioner. Acting Solicitor General Bell, Assistant Attorney General Morris, and Mr. Sewall Key for the United States. Reported below: 85 Ct. Cls. 492; 19 F. Supp. 557. No. 664. Wilkinson v. United States. February 28, 1938. Pétition for writ of certiorari to the Court of Claims denied. Mr. Rees B. Gillespie for petitioner. Acting Solicitor General Bell, Assistant Attorney General Whitaker, and Messrs. Henry A. Julicher and Paul A. Sweeney for the United States. Reported below: 85 Ct. Cls. 329. No. 683. United States ex rel. Pannone v. Martineau, U. S. Immigration Inspector. February 28, 1938. Pétition for writ of certiorari to the Circuit Court of Appeals for the Second Circuit denied. Mr. Thomas R. Robinson for petitioner. Acting Solicitor General Bell, Assistant Attorney General McMahon, and Messrs. William W. Barron and Bart W. Butler for respondent. Reported below: 93 F. 2d 1021. No. 685. Taylor v. Calmar Steamship Corp. February 28, 1938. Pétition for writ of certiorari to the Circuit Court of Appeals for the Third Circuit denied. Mr. Howard M. Long for petitioner. Messrs. Frank A. Bull, O. D. Duncan, and Russell T. Mount for respondent. Reported below : 92 F. 2d 84. 644 OCTOBER TERM, 1937. Decisions Denying Certiorari. 303 U. S. No. 687. Walker v. United States; No. 688. Drummond v. Same; No. 689. Luteran v. Same; No. 690. Adams v. Same; No. 691. Lorne E. Wells v. Same; No. 692. Joe R. Wells, Jr. v. Same; No. 693. Roach v. Same; No. 694. Little v. Same; No. 695. Stevens v. Same; No. 696. Holman v. Same; No. 697. Neeper v. Same; and No. 698. Ditsch v. Same. February 28, 1938. Pétition for writs of certiorari to the Circuit Court of Appeals for the Eighth Circuit denied. Messrs. I. J. Ringol-sky, Harry L. Jacobs, Ludwick Graves, Irvin Fane, James Dalio and Wm. G. Boatright for petitioners. Acting Solicitor General Bell, Assistant Attorney General McMahon, William W. Barron, Mathew F. McGuire, and W. Marvin Smith for the United States. Reported below: 93 F. 2d 383, 395, 401, 409. No. 702. Associated Indemnity Corp. et al. v. George F. Getty Oil Co. February 28, 1938. Pétition for writ of certiorari to the Circuit Court of Appeals for the Tenth Circuit denied. Mr. Frank A. Leffingwell for petitioners. No appearance for respondent. Reported below : 92 F. 2d 255. No. 717. Atlanta Beer Distributing Co. v. Alexander, Administrator, Fédéral Alcohol Administration. February 28, 1938. Pétition for writ of certiorari to the Circuit Court of Appeals for the Fifth Circuit denied. Mr. James F. Kemp for petitioner. Acting Solicitor General Bell, Assistant Attorney General McMahon, and Messrs. William W. Barron and W. Marvin Smith for respondent. Reported below: 93 F. 2d 11. 303 U. S. OCTOBER TERM, 1937. Decisions Denying Certiorari. 645 No. 729. Harriss et al. v. Indemnity Insurance Co. et al. February 28, 1938. Pétition for writ of certiorari to the Circuit Court of Appeals for the Second Circuit denied. Mr. Warner Pyne for petitioners. Mr. James I. Cuff for respondents. Reported below : 93 F. 2d 459. No. 658. Middle States Petroleum Corp. v. United States. February 28,1938. Pétition for writ of certiorari to the Court of Claims denied. Messrs. Thaddeus G. Benton and Conrad E. Cooper for petitioner. Acting Solicitor General Bell, Assistant Attorney General Morris, and Messrs. Sewall Key and Guy Patten for the United States. Reported below: 85 Ct. Cls. 232; 18 F. Supp. 945; 21 F. Supp. 128. No. 663. Bothwell et al., Receivers, v. United States. February 28, 1938. Pétition for writ of certiorari to the Court of Claims denied. Mr. Walter J. Car-rico for petitioners. Acting Solicitor General Bell, Assistant Attorney General Morris, and Messrs. J. Louis Mon-arch and Guy Patten for the United States. Reported below: 85 Ct. Cls. 150; 18 F. Supp. 1011. No. 701. Hyland v. Millers National Insurance Co. et al. February 28, 1938. Pétition for writ of certiorari to the Circuit Court of Appeals for the Ninth Circuit denied. Mr. William S. Graham for petitioner. Messrs. Jewel Alexander, Percy V. Long and Wm. H. Or-rick for respondents. Reported below: 91 F. 2d 735; 92 F. 2d 462. No. 703. Bull, Executor v. United States. February 28, 1938. Pétition for writ of certiorari to the Court of Claims denied. Mr. David A. Buckley, Jr. for peti- 646 OCTOBER TERM, 1937. Decisions Denying Certiorari. 303 U. S. tioner. Acting Solicitor General Bell, Assistant Attorney General Morris, and Mr. J. Louis Monarch for the United States. Reported below: 84 Ct. Cls. 632. No. 713. Dubrin et al. v. United States; and No. 714. Weinstein v. Same. February 28, 1938. Pétition for writs of certiorari to the Circuit Court of Appeals for the Second Circuit denied. Mr. George H. Combs, Jr. for petitioners in No. 713. Mr. C. Dickerman Williams for petitioner in No. 714. Acting Solicitor General Bell, Assistant Attorney General McMahon, and Messrs. William W. Barron and W. Marvin Smith for the United States. Reported below: 93 F. 2d 499. No. 718. Tomlinson v. United States. February 28, 1938. Pétition for writ of certiorari to the Court of Appeals for the District of Columbia denied. Messrs. James A. O’Shea, John H. Burnett, and Alfred, Goldstein for petitioner. Acting Solicitor General Bell, Assistant Attorney General McMahon, and Mr. William W. Barron for the United States. Reported below: 68 App. D. C. 106; 93 F. 2d 652. No. 720. Mackenzie-Kennedy v. United States. February 28, 1938. Pétition for writ of certiorari to the Court of Claims denied. Mr. Herman J. Galloway for petitioner. Acting Solicitor General Bell, Assistant Attorney General Whitaker, and Messrs. Henry A. Julicher and Paul P. Stoutenburgh for the United States. Reported below: 85 Ct. Cls. 405. No. 724. Lupo v. Zerbst, Warden. February 28, 1938. Pétition for writ of certiorari to the Circuit Court of Appeals for the Fifth Circuit denied. Mr. William 303 U. S. OCTOBER TERM, 1937. Decisions Denying Certiorari. 647 Schley Howard for petitioner. Acting Solicitor General Bell, Assistant Attorney General McMahon, and Messrs. William W. Barron and Bâtes Booth for respondent. Reported below: 92 F. 2d 362. No. 728. Byrd-Frost, Inc. v. Elder. February 28, 1938. Pétition for writ of certiorari to the Circuit Court of Appeals for the Fifth Circuit denied. Mr. Webster Atwell for petitioner. Mr. P. G. McElwee for respondent. Reported below: 93 F. 2d 30. No. 731. Yvette Company v. United States. February 28, 1938. Pétition for writ of certiorari to the Circuit Court of Appeals for the Second Circuit denied. Mr. Robert T. Tedrow for petitioner. Acting Solicitor General Bell, Assistant Attorney General Morris, and Messrs. J. Louis Monarch, William H. Boyd, Earl C. Crouter, and Joseph W. Bums for the United States. Reported below: 93 F. 2d 1019. No. 732. Corbett v. Equitable Life Insurance Society. February 28, 1938. Pétition for writ of certiorari to the Circuit Court of Appeals for the Seventh Circuit denied. Mr. Thomas F. OMara for petitioner. Mr. Henry I. Green for respondent. Nos. 733, 734, and 735. Willcox, Trustée in Bankruptcy, v. Goess, Receiver. February 28, 1938. Pétition for writs of certiorari to the Circuit Court of Appeals for the Second Circuit denied. Mr. Morris Ehrlich for petitioner. Messrs. Martin Conboy, Bernard Sobol, George P. Barse, and John F. Anderson for respondent. Reported below: 92 F. 2d 8. 648 OCTOBER TERM, 1937. Decisions Denying Certiorari. 303 U. S. No. 739. American Surety Co. v. Town of Hamden. February 28, 1938. Pétition for writ of certiorari to the Circuit Court of Appeals for the Second Circuit denied. Mr. Charles D. Lockwood for petitioner. Mr. Curtiss K. Thompson for respondent. Reported below: 93 F. 2d 482. No. 743. Maynard et al. v. Finney et al. February 28, 1938. Pétition for writ of certiorari to the Circuit Court of Appeals for the Fifth Circuit denied. Messrs. A. C. Wheeler and Robert L. Russell for petitioners. No appearance for respondents. Reported below: 92 F. 2d 454. No. 749. Baltimore & Ohio R. Co. v. Love, Admin-istratrix. February 28, 1938. Pétition for writ of certiorari to the Suprême Court of New York denied. Mr. William C. Combs for petitioner. Mr. Eugene Van Voor-his for respondent. Reported below: 276 N. Y. 513; 251 App. Div. 783; 12 N. E. 454; 298 N. Y. S. 175. No. 737. Klipstein, Trustée, v. Davidowicz et al. March 7, 1938. Pétition for writ of certiorari to the Circuit Court of Appeals for the Second Circuit denied. Mr. Harold H. Levin for petitioner. Messrs. John J. Bennett, Jr., Attorney General, Henry Epstein, Solicitor General, and Mr. Joseph A. McLaughlin, Assistant Attorney General, of New York, for the Industrial Board, respondent. Reported below: 92 F. 2d 417. No. 741. Pink, Superintendent of Insurance, v. Dempsey; and No. 767. Dempsey v. Pink, Superintendent of Insurance. March 7, 1938. Pétitions for writs of certio- 303 U. S. OCTOBER TERM, 1937. Decisions Denying Certiorari. 649 rari to the Circuit Court of Appeals for the Second Circuit denied. Mr. Alfred, C. Bennett for Pink. Messrs. Bruce Fuller and S. Wallace Dempsey for Dempsey. Reported below: 92 F. 2d 572. No. 742. Union Stock Yards Co. v. Inghram et al. March 7, 1938. Pétition for writ of certiorari to the Suprême Court of Nebraska denied. Mr. Norris Brown for petitioner. No appearance for respondent. Reported below: 133 Neb. 105; 274 N. W. 185. No. 747. Rabinovitz v. Oughton, Trustée. March 7, 1938. Pétition for writ of certiorari to the Circuit Court of Appeals for the Third Circuit denied. Messrs. Thomas F. Gain and Sigmund H. Steinberg for petitioner. No appearance for respondent. Reported below: 92 F. 2d 297. No. 750. Phillips v. United States. March 7, 1938. Pétition for writ of certiorari to the Circuit Court of Appeals for the Seventh Circuit denied. Mr. Edward H. S. Martin for petitioner. Acting Solicitor General Bell, and Messrs. Julius C. Martin, Wilbur C. Pickett, W. Marvin Smith, and Young M. Smith for the United States. Reported below : 92 F. 2d 849. No. 751. Nashville, C. & St. L. Ry. v. Railway Em-ployees’ Dept. of A. F. of L. et al. March 7, 1938. Pétition for writ of certiorari to the Circuit Court of Appeals for the Sixth Circuit denied. Mr. Wm. H. Swiggart for petitioner. Mr. Frank L. Mulholland for respondents. Reported below : 93 F. 2d 340. 650 OCTOBER TERM, 1937. Decisions Denying Certiorari. 303 U. S. No. 754. Awotin v. IIealy et al. March 7, 1938. Pétition for writ of certiorari to the Circuit Court of Appeals for the Seventh Circuit denied. Mr. Irving H. Flamm for petitioner. Messrs. Emmett J. McCarthy, Robert F. Carey, and Daniel M. Healy for respondents. Reported below: 92 F. 2d 615. No. 755. Annett v. New York, N. H. & H. R. Co. March 7, 1938. Pétition for writ of certiorari to the Circuit Court of Appeals for the Second Circuit denied. Mr. Curtiss K. Thompson for petitioner. Messrs. Edward R. Brumley, Jesse E. Waid, and Frederick, H. Wiggin for respondent. Reported below : 92 F. 2d 428. No. 433. Harman v. Commissioner of Internal Revenue. March 7, 1938. Pétition for writ of certiorari to the Circuit Court of Appeals for the Second Circuit denied. Messrs. Mark Eisner and Ferdinand Tannen-baum for petitioner. Solicitor General Reed, Assistant Attorney General Morris, and Mr. Sewall Key for respondent. Reported below : 90 F. 2d 622. No. 827. Dowling v. Western Union Telegraph Co. March 14, 1938. Pétition for writ of certiorari to the Circuit Court of Appeals for the First Circuit, and motion for leave to proceed further in forma pauperis, denied. Mr. James H. Dufîy for petitioner. No appear-ance for respondent. Reported below: 92 F. 2d 864. No. 726. Murphy v. Zerbst, Warden. March 14, 1938. Pétition for writ of certiorari to the Circuit Court of Appeals for the Fifth Circuit denied. Mr. E. Harold Sheats for petitioner. Acting Solicitor General Bell, As- 303 U. S. OCTOBER TERM, 1937. Decisions Denying Certiorari. 651 sistant Attorney General McMahon, and Messrs. William W. Barron, and W. Marvin Smith for respondent. Solicitor General Jackson was on a brief for the respondent. Reported below: 92 F. 2d 671. No. 740. International Manufacturées Sales Co. v. United States. March 14, 1938. Pétition for writ of certiorari to the Court of Claims denied. Mr. Loring M. Black for petitioner. Acting Solicitor General Bell, Assistant Attorney General Whitaker, and Mr. Paul A. Sweeney for the United States. Reported below: 85 Ct. Cls. 683. No. 744. Washington v. McGrath, Executrix. March 14, 1938. Pétition for writ of certiorari to the Suprême Court of Washington denied. Mr. William H. Pemberton for petitioner. No appearance for respondent. Reported below : 191 Wash. 496; 71 P. 2d 395. No. 752. Atlantic Coast Line R. Co. v. Batton. March 14, 1938. Pétition for writ of certiorari to the Suprême Court of North Carolina denied. Messrs. Thomas W. Davis, F. S. Spruïll, and V. E. Phelps for petitioner. Mr. W. Frank Taylor for respondent. Reported below: 212 N. C. 256; 193 S. E. 674. No. 758. Capone v. United States. March 14,1938. Pétition for writ of certiofari to the Circuit Court of Appeals for the Seventh Circuit denied. Mr. Abraham Teitelbaum for petitioner. Acting Solicitor General Bell, Assistant Attorney General Morris, and Messrs. J. Louis Monarch, William H. Boyd, Earl C. Crouter, and W. Marvin Smith for the United States. Reported below: 93 F. 2d 840. 652 OCTOBER TERM, 1937. Decisions Denying Certiorari. 303 U. S. No. 759. Smith et al. v. United States. March 14, 1938. Pétition for writ of certiorari to the Circuit Court of Appeals for the Second Circuit denied. Mr. Richard E. Westbrooks for petitioner. Acting Solidtor General Bell, Assistant Attorney General McMahon, and Messrs. William W. Barron, and W. Marvin Smith for the United States. Reported below: 93 F. 2d 1019. No. 763. London & Provincial Marine & General Ins. Co. v. Kentucky Macaroni Co.; and No. 764. Royal Insurance Co. v. Same. March 14, 1938. Pétition for writs of certiorari to the Circuit Court of Appeals for the Sixth Circuit denied. Mr. Frank M. Drake for petitioners. Mr. Robert S. Marx for respondent. Reported below: 92 F. 2d 1009. No. 765. Salt Lake County v. Utah Copper Co. March 14, 1938. Pétition for writ of certiorari to the Circuit Court of Appeals for the Tenth Circuit denied. Messrs. Mahlon E. Wilson and Harold E. Wallace for petitioner. Messrs. A. C. Ellis and C. C. Parsons for respondent. Reported below: 93 F. 2d 127. No. 766. Stein, Trustée in Bankruptcy, v. Leibo-witt et al. March 14, 1938. Pétition for writ of certiorari to the Circuit Court of Appeals for the Third Circuit denied. Mr. David Goldstein for petitioner. Mr. Louis Rudner for respondents. Reported below: 93 F. 2d 333. No. 776. Pickett v. Trixler, Receiver, et al. March 14, 1938. Pétition for writ of certiorari to the Circuit Court of Appeals for the Seventh Circuit denied. Mr. U. S. Lesh for petitioner. No appearance for respondents. Reported below : 93 F. 2d 178. 303 U. S. OCTOBER TERM, 1937. Decisions Denying Certiorari. 653 No. 793. Marshall County Bank v. Crowther. March 14, 1938. Pétition for writ of certiorari to the Suprême Court of Appeals of West Virginia denied. Mr. Martin Brown for petitioner. No appearance for respondent. Reported below: 119 W. Va. —; 193 S. E. 915. No. 794. St. Paul Fire & Marine Ins. Co. v. Kaufman Compress Co. March 14, 1938. Pétition for writ of certiorari to the Circuit Court of Appeals for the Fifth Circuit denied. Mr. Lloyd E. Elliott for petitioner. Mr. Dan MacDougald for respondent. Reported below : 93 F. 2d 156. No. 795. American Concrète Expansion Joint Co. et al. v. Highway Appliances Co. March 14, 1938. Pétition for writ of certiorari to the Circuit Court of Appeals for the Seventh Circuit denied. Mr. Samuel W. Banning for petitioners. Mr. Albert G. McCaleb for respondent. Reported below: 93 F. 2d 113. No. 804. Livermore v. Mandeville & Thompson, Inc. March 14, 1938. Pétition for writ of certiorari to the Circuit Court of Appeals for the Fifth Circuit denied. Mr. Del W. Harrington for petitioner. Mr. Frank M. Bailey for respondent. Reported below : 93 F. 2d 563. No. 819. Gage et al., Receivers, v. Leonard, Receiver, et al. March 14, 1938. Pétition for writ of certiorari to the Circuit Court of Appeals for the Fourth Circuit denied. Messrs. Christie Benet and Edward W. Mullins for petitioners. Mr. George P. Barse for respondents. Reported below: 94 F. 2d 19. 654 OCTOBER TERM, 1937. Decisions Denying Certiorari. 303 U. S. No. 857. Kirkpatrick v. Hardt. See ante, p. 626. No. 847. Pope v. United States. March 28, 1938. Pétition for writ of certiorari to the Court of Claims, and motion for leave to proceed further in forma pauperis, denied. Mr. Allen Pope, pro se. No appearance for the United States. Reported below : 86 Ct. Cls. 18. No. 853. Lindsey et al. v. Washington. March 28, 1938. Pétition for writ of certiorari to the Suprême Court of Washington, and motion for leave to proceed further in forma pauperis, denied. E. R. Lindsey, pro se. No appearance for respondent. Reported below: 192 Wash. 356; 73 P. 2d 738. No. 875. Jordon v. United States. March 28, 1938. Pétition for writ of certiorari to the Court of Appeals for the District of Columbia, and motion for leave to proceed further in forma pauperis, denied. Mr. James J. Laughlin for petitioner. No appearance for the United States. Reported below: 66 App. D. C. 309; 87 F. 2d 64. No. 678. New York ex rel. Kurzynski v. Hunt, Warden. March 28, 1938. Pétition for writ of certiorari to the Suprême Court of New York denied. Paul Kurzynski, pro se. Mr. Henry Epstein, Solicitor General of New York, for respondent. Reported below: 250 App. Div. 378; 294 N. Y. S. 276. No. 797. Bankers Life Co. v. City of Littlefield et al. March 28, 1938. Pétition for writ of certiorari to the Circuit Court of Appeals for the Fifth Circuit denied. 303 U. S. OCTOBER TERM, 1937. Decisions Denying Certiorari. 655 Messrs. J. P. Lorentzen and A. E. Coker for petitioner. Messrs. James G. Martin and C. C. Crenshaw for respond-ents. Reported below: 93 F. 2d 152. No. 800. Century Productions, Inc., et al. v. Patterson. March 28, 1938. Pétition for writ of certiorari to the Circuit Court of Appeals for the Second Circuit denied. Mr. Henry Pearlman for petitioners. Mr. Edward A. Sargoy for respondent. Reported below: 93 F. 2d 489. No. 803. Mechanical Manufacturing Co. v. Mac-Andrews & Forbes Co. March 28, 1938. Pétition for writ of certiorari to the Suprême Court of Illinois denied. Messrs. Samuel A. Ettelson and Erwin M. Treusch for petitioner. Messrs. Loy N. Mclntosh and Frederick Secord for respondent. Reported below: 367 111. 288; 11 N. E. 2d 382. No. 807. Phillips v. Tarrier Company. March 28, 1938. Pétition for writ of certiorari to the Circuit Court of Appeals for the Fifth Circuit denied. Mr. H. M. Voorhis for petitioner. Mr. Robert A. Littleton for respondent. Reported below: 93 F. 2d 674. No. 808. Missouri Broadcasting Corp. v. Fédéral Communications Commission et al. March 28, 1938. Pétition for writ of certiorari to the Court of Appeals for the District of Columbia denied. Messrs. Louis G. Cald-well and Donald C. Beelar for petitioner. Solicitor General Jackson, Acting Assistant Attorney General Berge, and Messrs. Charles H. Weston and Hampson Gary for the Fédéral Communications Commission. Mr. Paul D. P. Spearman for the Star-Times Publishing Co. Reported below: 94 F. 2d 623. 656 OCTOBER TERM, 1937. Decisions Denying Certiorari. 303 U. S. No. 806. Royal Insurance Co. v. Smith. March 28, 1938. Pétition for writ of certiorari to the Circuit Court of Appeals for the Ninth Circuit denied. Mr. Percy V. Long for petitioner. Messrs. A. B. Bianchi and James M. Hanley for respondent. Reported below: 93 F. 2d 143. No. 809. McGoldrick, Comptroller, v. National Cash Register Co. ; and No. 810. Same v. West Publishing Co. March 28, 1938. Pétitions for writs of certiorari to the Suprême Court of New York denied. Messrs. Wm. C. Chanter, Oscar S. Cox, Paxton Blair, and Meyer Bernstein for petitioner. Mr. Philip A. Carroll for respondent in No. 809. Messrs. Chester Bordeau and Francis L. Casey for respondent in No. 810. Reported below: No. 809, 267 N. Y. 208; 252 App. Div. 90; 11 N. E. 2d 881; 297 N. Y. S. 169; No. 810, 276 N. Y. 535; 251 App. Div. 883; 12 N. E. 2d 565; 297 N. Y. S. 174. Nos. 812 and 813. Mercantile-Commerce Bank & Trust Co. et al. v. Department of Financial Institutions of Indiana et al. March 28, 1938. Pétition for writs of certiorari to the Circuit Court of Appeals for the Seventh Circuit denied. Mr. Truman Post Young for petitioners. Mr. Isador Kahn for respondents. Reported below : 92 F. 2d 639. No. 816. Terminal Railroad Assn. v. Mrazek. March 28, 1938. Pétition for writ of certiorari to the Suprême Court of Missouri denied. Messrs. Thomas M. Pierce, Joseph L. Howell, and Walter N. Davis for petitioner. Messrs. Harry S. Rooks and Oscar Habenicht for respondent. Reported below: 341 Mo. 1054; 111 S. W. 2d 26. 303 U. S. OCTOBER TERM, 1937. Decisions Denying Certiorari. 657 No. 830. Touhy v. Ragen, Warden. March 28, 1938. Pétition for writ of certiorari to the Suprême Court of Illinois denied. Mr. Thomas Marshall for petitioner. Mr. Otto Kerner for respondent. No. 836. East Ohio Gas Co. v. Cleveland. March 28, 1938. Pétition for writ of certiorari to the Circuit Court of Appeals for the Sixth Circuit denied. Mr. William B. Cockley for petitioner. Mr. Alfred Clum for respondent. Reported below: 94 F. 2d 443. No. 790. Paridy v. Caterpillar Tractor Co. March 28, 1938. Pétition for writ of certiorari to the Circuit Court of Appeals for the Seventh Circuit denied. Mr. Justice Butler took no part in the considération or decision of this application. Mr. Frank C. Smith for petitioner. No appearance for respondent. Reported below: 94 F. 2d 292. No. 599. Glenn, Collector, v. Smith. March 28, 1938. Pétition for writ of certiorari to the Circuit Court of Appeals for the Sixth Circuit denied. Mr. Justice Reed took no part in the considération or decision of this application. Solicitor General Reed for petitioner. No appearance for respondent. Reported below: 91 F. 2d 447. No. 17, original. Ex parte Arthur Dean Richmond. April 4, 1938. Motion for leave to file pétition for writ of certiorari is granted, and the pétition for writ of certiorari is denied. Mr. William Lemke for petitioner. 53383°—38----------42 658 OCTOBER TERM, 1937. Decisions Denying Certiorari. 303 U. S. No. 896. Lee v. Plummer, Warden. April 4, 1938. Pétition for writ of certiorari to the Suprême Court of California, and motion for leave to proceed further in forma pauperis, denied. Howard Lee, pro se. No appearance for respondent. No. 838. Atlantic Refining Co. v. Smith et al. April 4, 1938. Pétition for writ, of certiorari to the Circuit Court of Appeals for the Third Circuit denied. Mr. Justice Roberts took no part in the considération or decision of this application. Mr. Otto Wolff, Jr. for petitioner. Mr. Walter B. Gibbons for respondents. Reported below: 94 F. 2d 377. No. 818. Doherty v. United States. April 4, 1938. Pétition for writ of certiorari to the Circuit Court of Appeals for the Eighth Circuit denied. Mr. W. V. Hoag-land for petitioner. Solicitor General Jackson, Assistant Attorney General McMahon, and Messrs. William W. Barron, W. Marvin Smith, and L. E. Birdzell for the United States. Reported below : 94 F. 2d 495. No. 820. Brooklyn Trust Co. v. Sherman Square Apartments, Inc., et al. April 4, 1938. Pétition for writ of certiorari to the Circuit Court of Appeals for the Second Circuit denied. Messrs. Jacob A. Freedman and Ralph W. Crolly for petitioner. Messrs. Whitney North Seymour, John Ross Delafield, and Emanuel Celler for respondents. Reported below: 93 F. 2d 1015. No. 821. Wolk v. United States. April 4, 1938. Pétition for writ of certiorari to the Circuit Court of Appeals for the Eighth Circuit denied. Messrs. William C. 303 U. S. OCTOBER TERM, 1937. Decisions Denying Certiorari. 659 Green and George B. Edgerton for petitioner. Solicitor General Jackson, Assistant Attorney General McMahon, and Messrs. William W. Barron and W. Marvin Smith for the United States. Reported below: 94 F. 2d 310. No. 823. LaBudde, Collector of Internal Revenue, v. Cudahy Brothers Co. April 4, 1938. Pétition for writ of certiorari to the Circuit Court of Appeals for the Seventh Circuit denied. Acting Solicitor General Bell for petitioner. Mr. William F. Hannan for respondent. Reported below: 92 F. 2d 937. No. 824. Williams, Trustée in Bankruptcy, v. Corden Corporation et al. April 4, 1938. Pétition for writ of certiorari to the Circuit Court of Appeals for the Ninth Circuit denied. Mr. James M. Naylor for petitioner. Messrs. Ernest J. Torregano and Charles M. Stark for respondents. Reported below: 93 F. 2d 758. No. 825. Fort Pitt Bridge Works v. Commissioner of Internal Revenue. April 4, 1938. Pétition for writ of certiorari to the Circuit Court of Appeals for the Third Circuit denied. Messrs. Robert T. McCracken and Leonard K. Guiler for petitioner. Solicitor General Jackson, Assistant Attorney General Morris, and Messrs. Sewall Key and F. E. Youngman for respondent. Reported below: 92 F. 2d 825. No. 826. Kosolapoff v. Petrogradsky Mejdunar-odny Kommerchesky Bank. April 4, 1938. Pétition for writ of certiorari to the Suprême Court of New York denied. Mr. Harmon S. Graves for petitioner. Messrs. 660 OCTOBER TERM, 1937. Decisions Denying Certiorari. 303 U. S. Paul C. Whipp and Lounsbury D. Bâtes for respondent. Reported below: 276 N. Y. 499; 248 App. Div. 864; 12 N. E. 2d 449; 291 N. Y. S. 388. No. 828. Golding Brothers Co. v. Dumaine et al., Trustées. April 4, 1938. Pétition for writ of certiorari to the Circuit Court of Appeals for the First Circuit denied. Mr. Israël Gorovitz for petitioner. Mr. Charles P. Curtis, Jr. for respondents. Reported below: 93 F. 2d 162. No. 833. Boston Machine Works Co. v. Prime Manufacturing Co. April 4, 1938. Pétition for writ of certiorari to the Circuit Court of Appeals for the First Circuit denied. Mr. Melville F. Weston for petitioner. Messrs. George P. Dike and Cedric W. Porter for respondent. Reported below: 93 F. 2d 594. No. 837. Roberts et al. v. Metropolitan Life Ins. Co. et al. April 4, 1938. Pétition for writ of certiorari to the Circuit Court of Appeals for the Seventh Circuit denied. Mr. Jay E. Darlington for petitioners. Mr. S. Ashley Guthrie for respondents. Reported below: 94 F. 2d 277. No. 843. Cohen v. Maryland. April 4, 1938. Pétition for writ of certiorari to the Court of Appeals of Maryland denied. Messrs. Harry O. Levin and Isaac Lobe Straus for petitioner. No appearance for respondent. Reported below: 173 Md. 216; 195 A. 532. No. 844. Robert Jacob, Inc., v. Gunnarson, Administrâtes, ET al. April 4, 1938. Pétition for writ of certiorari to the Circuit Court of Appeals for the Second 303 U. S. OCTOBER TERM, 1937. Decisions Denying Certiorari. 661 Circuit denied. Mr. George S. Brengle for petitioner. Mr. Forrest E. Single for respondents. Reported below: 94 F. 2d 170. No. 845. United States v. Wharton Green & Co. April 4, 1938. Pétition for writ of certiorari to the Court of Claims denied. Acting Solicitor General Bell for the United States. Messrs. George A. King, George R. Shields, and Herman J. Galloway for respondent. Reported below: 86 Ct. Cls. 100. No. 856. Quick Action Ignition Co. v. Briggs & Stratton Corp. April 4, 1938. Pétition for writ of certiorari to the Circuit Court of Appeals for the Seventh Circuit denied. Mr. N. S. Arnstutz for petitioner. Messrs. Ira Milton and Richard Spencer for respondent. Reported below: 93 F; 2d 207. No. 873. Burke Grain Co. v. Saint Paul Mercury-Indemnity Co. April 4, 1938. Pétition for writ of certiorari to the Circuit Court of Appeals for the Eighth Circuit denied. Mr. Tom Kirby for petitioner. Mr. G. J. Danjorth for respondent. Reported below : 94 F. 2d 458. No. 876. Hood, Successor Receiver, v. Hardesty, Receiver. April 4, 1938. Pétition for writ of certiorari to the Circuit Court of Appeals for the Fourth Circuit denied. Mr. James M. Guiher for petitioner. Mr. George P. Barse for respondent. Reported below : 94 F. 2d 26. No. 846. Standard Marine Ins. Co. v. Westchester Fire Ins. Co. April 11, 1938. Pétition for writ of certiorari to the Circuit Court of Appeals for the Second 662 OCTOBER TERM, 1937. Decisions Denying Certiorari. 303 U. S. Circuit denied. Mr. Justice Stone took no part in the considération or decision of this application. Messrs. Hartwell Cabell, Milton B. Ignatius, and Wendell P. Bar-ker for petitioner. Messrs. Oscar R. Houston and D. Roger Englar for respondent. Reported below : 93 F. 2d 286. No. 849. American Snuff Co. v. Commissioner of Internal Revenue. April 11, 1938. Pétition for writ of certiorari to the Circuit Court of Appeals for the Sixth Circuit denied. Mr. Justice Stone took no part in the considération or decision- of this application. Mr. L. A. Luce for petitioner. Solicitor General Jackson, Assistant Attorney General Morris, and Messrs. Sewall Key and L. W. Post for respondent. Reported below: 93 F. 2d 201. No. 831. Bonet, Treasurer of Puerto Rico, v. Quilès. April 11, 1938. Pétition for writ of certiorari to the Circuit Court of Appeals for the First Circuit denied. Messrs. William Cattron Rigby and Nathan R. Margold for petitioner. No appearance for respondent. Reported below: 93 F. 2d 331. No. 832. Bonet, Treasurer of Puerto Rico, v. N Air-iente & Co. April 11, 1938. Pétition for writ of certiorari. to the Circuit Court of Appeals for the First Circuit denied. Messrs. William Cattron Rigby and Nathan R. Margold for petitioner. Mr. Edelmiro Martinez Rivera for respondent. Reported below: 93 F. 2d 327. No. 834. Di Santo v. United States. April 11, 1938. Pétition for writ of certiorari to the Circuit Court of Appeals for the Sixth Circuit denied. Mr. William 303 U. S. OCTOBER TERM, 1937. Decisions Denying Certiorari. 663 J. Dawley for petitioner. Solidtor General Jackson, As-sistant Attorney General McMahon, and Messrs. Fred E. Strine and W. Marvin Smith for the United States. Reported below: 93 F. 2d 948. No. 835. M. McDonough Co. v. Waldorf System, Inc. April 11, 1938. Pétition for writ of certiorari to the Circuit Court of Appeals for the First Circuit denied. Mr. A. G. Gould for petitioner. Mr. Frank H. Stewart for respondent. Reported below: 93 F. 2d 363. No. 839. Sterling v. Commissioner of Internal Revenue. April 11, 1938. Pétition for writ of certiorari to the Circuit Court of Appeals for the Second Circuit denied. Mr. Edward Holloway for petitioner. So-licitor General Jackson, Assistant Attorney General Morris, and Messrs. Sewall Key and Morton K. Rothschild for respondent. Reported below : 93 F. 2d 304. No. 851. Grunwald et al. v. United States; and No. 852. Lubitzky v. Same. April 11,1938. Pétition for writs of certiorari to the Circuit Court of Appeals for the Third Circuit denied. Mr. Frédéric M. P. Pearse for petitioners. Solidtor General Jackson, Assistant Attorney General McMahon, and Messrs. Mahlon D. Kiefer and W. Marvin Smith for the United States. Reported below: 94 F. 2d 952. No. 854. United States v. Moor. April 11, 1938. Pétition for writ of certiorari to the Circuit Court of Appeals for the Fifth Circuit denied. Solictor General Jackson for petitioner. No appearance for respondent. Reported below : 93 F. 2d 422. 664 OCTOBER TERM, 1937. Decisions Denying Certiorari. 303 U. S. No. 855. Townsend v. United States. April 11, 1938. Pétition for writ of certiorari to the Court of Appeals for the District of Columbia denied. Messrs. Elisha Hanson and Joseph A. Cantrel for petitioner. Solicitor General Jackson, Assistant Attorney General McMahon, and Messrs. William W. Barron and W. Marvin Smith for the United States. Reported below : 95 F. 2d 352. No. 862. Wyman v. Newhouse. April 11, 1938. Pétition for writ of certiorari to the Circuit Court of Appeals for the Second Circuit denied. Mr. C. C. Daniels for petitioner. Mr. Max D. Steuer for respondent. Reported below: 93 F. 2d 313. No. 867. Brown-Crummer Investment Co., Trustée, v. City of Hamlin et al. April 11, 1938. Pétition for writ of certiorari to the Circuit Court of Appeals for the Fifth Circuit denied. Messrs. David M. Wood and James G. Martin for petitioner. Messrs. J. McAllister Stevenson and W, Edward Lee for respondents. Reported below: 93 F. 2d 680. No. 868. Blair v. T. W. Warner Co. April 11, 1938. Pétition for writ of certiorari to the Circuit Court of Appeals for the Second Circuit denied. Mr. Eli J. Blair for petitioner. Mr. Abbot P. Mills for respondent. Reported below : 94 F. 2d 13. 303 U. S. OCTOBER TERM, 1937. Rehearings Denied. 665 CASES DISPOSEE OF WITHOUT CONSIDERATION BY THE COURT, FROM JANUARY 18, 1938, THROUGH APRIL 11, 1938. No. 633. Brainard v. Commissioner of Internal Revenue. Certiorari, 302 U. S. 682, to the Circuit Court of Appeals for the Seventh Circuit. Argued March 9,1938. Dismissed March 14, 1938, on motion of counsel for the petitioner. Mr. John E. Hughes for petitioner. Mr. A. F. Prescott, with whom Acting Solicitor General Bell, Assistant Attorney General Morris, Mr. J. Louis Monarch and also Solicitor General Jackson were on the briefs, for respondent. Reported below: 91 F. 2d 880. Nos. 841 and 842. Massey v. Farmers & Merchants National Bank & Trust Co. et al. On pétition for writs of certiorari to the Circuit Court of Appeals for the Fourth Circuit. March 28, 1938. Dismissed on motion of counsel for the petitioner. Messrs. Robert H. Mc-Neill, William Lemke, and John W. Cleaton for petitioner. Mr. R. Gray Williams for respondents. Reported below: 94 F. 2d 526. PETITIONS FOR REHEARING DENIED, FROM JANUARY 18, 1938, THROUGH APRIL 11, 1938.* No. 146. United States v. Raynor. January 31, 1938. 302 U. S. 540. No. 147. United States v. Fowler. January 31, 1938. 302 U. S. 540. * See Table of Cases Reported in this volume for earlier decisions in these cases, unless otherwise indicated. 666 OCTOBER TERM, 1937. Rehearings Denied. 303 U. S. No. 304. Kelley et al. v. Atlantic City et al. January 31, 1938. 302 U. S. 722. No. 626. Alsop v. Helvering, Commissioner of Internal Revenue. January 31, 1938. 302 U. S. 767. No. 321. Johnson, Treasurer of California, et al. v. M. G. West Co. February 7, 1938. The motion for leave to file pétition for rehearing is granted. The pétition for rehearing is denied. 302 U. S. 638. No. 30. United States ex rel. Willoughby, Trustée, et al. v. Howard et al. February 7, 1938. 302 U. S. 445. No. 613. Almours Securities, Inc. v. Commissioner of Internal Revenue. February 7, 1938. 302 U. S. 765. No. 651. Spruill v. Serven; and No. 652. Spruill v. Ballard et al. February 7, 1938. 302 U. S. 764. No. 10. Océan Beach Heights, Inc., et al. v. Brown-Crummer Investment Co. et al. February 14, 1938. 302 U. S. 614. No. 671. Schultz v. Live Stock National Bank et al. February 14, 1938. 302 U. S. 766. No. 197. Adam v. Saenger et al. February 28, 1938. Ante, p. 59. OCTOBER TERM, 1937. 667 303 U. S. Rehearings Denied. No. 256. Indiana ex rel. Anderson v. Brand, Trustée. February 28,1938. Ante, p. 95. No. 346. Helvering, Commissioner of Jnternal Revenue, v. Bowers, Administratrix. February 28, 1938. No. 13. United Gas Public Service Co. v. Texas et al. See ante, p. 625. No. 161. South Carolina State Highway Dept. et al. v. Barnwell Bros., Inc., et al. See ante, p. 625. No. 712. Wabash Appliance Corp. et al. v. General Electric Co. March 14, 1938. No. 469. Foster, Executrix, v. Commissioner of Internal Revenue. March 14, 1938. No. 674. Schriber-Schroth Co. v. Cleveland Trust Co. et al. March 14, 1938. No. 675. Aberdeen Motor Supply Co. v. Cleveland Trust Co. et al. March 14, 1938. No. 676. F. E. Rowe Sales Co. v. Cleveland Trust Co. et al. March 14, 1938. No. 434, October Term, 1936. Abel et al. v. Kennedy et al. March 28, 1938. 299 U. S. 580, 622. 668 OCTOBER TERM, 1937. Rehearings Denied. 303 U. S. No. 635. Clarke, Trustée, v. Chicago, B. & Q. R. Co. March 28, 1938. No. 687. Walker v. United States. March 28, 1938. No. 688. Drummond v. United States. March 28, 1938. No. 689. Luteran v. United States. March 28, 1938. No. 690. Adams v. United States. March 28, 1938. No. 691. Wells v. United States. March 28, 1938. No. 692. Wells v. United States. March 28, 1938. No. 693. Roach v. United States. March 28, 1938. No. 694. Little v. United States. March 28, 1938. No. 695. Stevens v. United States. March 28, 1938. No. 696. Holman v. United States. March 28, 1938. No. 697. Neeper v. United States. March 28, 1938. No. 698. Ditsch v. United States. March 28, 1938. OCTOBER TERM, 1937. 669 303 U. S. Rehearings Denied. No. 791. Simpson et al. v. Dyer et al. March 28, 1938. No. 406. Helvering, Commissioner of Internal Revenue v. O’Donnell. April 4, 1938. Ante, p. 370. No. 446. Helvering, Commissioner of Internal Revenue v. Elbe Oïl Land Development Co. April 4, 1938. Ante, p. 372. No. 753. Groves et al. v. Board of Education of Chicago. April 4, 1938. No. 660. Moran, Receiver, v. United States. April 11, 1938. No. 853. Lindsey et al. v. Washington. April 11, 1938. AMENDMENT OF BANKRUPTCY RULES. Order of February 7, 1938. It is ordered that Rule LUI of the General Orders in Bankruptcy be, and the same hereby is, amended, effective immediately, to read as follows : LUI BOND OF DESIGNATED DEPOSITORY UNDER SEC. 61 1. The bond required of a banking institution desig-nated as a depository shall be given with an authorized fidelity or bonding company as surety, or with approved individual sureties who are residents of that judicial district and two of whom are neither officers nor directors of the institution designated as a depository. 2. The condition of bonds hereafter given shall be sub-stantially to the effect that the banking institution, so designated, shall well and truly account for and pay over ail monies deposited with it as such depository, and shall pay out such monies only as provided by the bankruptcy law and applicable general orders and court rules, and shall abide by ail orders of the bankruptcy court in respect of such monies, and shall otherwise faithfully per-form ail duties pertaining to it as such depository. 3. As one means of bringing before the bankruptcy court information respecting possible occasions for requir-ing a depository to give a new bond with different sureties, it shall be the duty of each depository to file with the bankruptcy court during the month of January in each year a sworn statement in writing disclosing (a) Whether any of the individual sureties on its bond has ceased to be a résident of that judicial district, or has died; and 671 672 AMENDMENT OF BANKRUPTCY RULES. (b) Whether the financial worth of any of its individ-ual sureties has become materially impaired. 4. As one means of bringing before the bankruptcy court information respecting occasions for requiring a depository to give a new bond in an increased amount, it shall be the duty of any depository, when its total of bankruptcy deposits equals ninety-five per centum of the amount of its current depository bond, forthwith to file a written statement with the bankruptcy court, setting forth the total amount of such deposits and the amount of its current bond. 5. No trustée or receiver shall deposit with any one depository funds committed to his custody as such receiver or trustée in excess of the amount of the bond of such depository then in force. 6. It shall be the duty of the bankruptcy court to re-quire a depository to give a new bond whenever it appears that the prior bond is not sufficient in amount, in view of présent and prospective deposits, or that a surety has died or ceased to be a résident of that judicial district, or whenever there is otherwise occasion to believe that the prior bond does not constitute adéquate security. 7. It shall be the duty of the bankruptcy court to re-quire each depository in its district to give a new bond within five years after the giving of its last prior bond. 8. A surety, or the personal représentative of a de-ceased surety, on the bond of a depository may, by a pétition setting forth the grounds therefor, request the bankruptcy court to require the depository to give a new bond and thereby to relieve such surety, or his estate, from responsibility and liability as respects any future default of the depository, and, if upon a hearing had after rea-sonable notice to the depository, to other sureties on the bond, and to the trustées or other représentatives of bank-rupt estâtes having deposits in such depository, it appears to the court that the pétition can be granted with- AMENDMENT OF BANKRUPTCY RULES. 673 out injury to any party in interest, the court shall re-quire the depository to give a new bond. 9. A new bond given under any subdivision of this general order shall, from the time of its approval by the bankruptcy court, be regarded as taking the place of the preceding bond as respects any subséquent default of the depository ; and, upon approving the new bond, the court shall enter an order relieving the sureties on the prior bond, and the estate of any deceased surety, from respon-sibility and liability thereon as respects any default of the depository occurring thereafter. 10. If any depository, when required to give a new bond, fails to comply with that requirement within the time fixed therefor by this general order or by the bankruptcy court, it shall be the duty of that court to order such depository to pay over ail monies on deposit with it as such depository, and to revoke its désignation as depository. [General Order LUI suspended, March 14, 1938, see p. 626.] 53383°—38----------43 INDEX ACCIDENT. See Insurance, 1. ACCOUNTING. See Taxation, II, 3. ADMINISTRATIVE AGENCIES. See Public Utilities, 2; Statutes, 7. 1. Exhaustion of Administrative Remedy as prerequisite to injunction. Myers v. Bethlehem Corp., 41. 2. Procedure before Labor Relations Board; constitutional re-quirements. Id; Labor Board v. Greyhound Lines, 261. ADMIRALTY. 1. Jurisdiction. Vessel of friendly government; immunity from suit; intervention of Ambassador. Compania Espanola v. The Navemar, 68. 2. Maintenance and Cure. Right of seaman; incurable illness not caused by employment; measure of recovery. Calmar S. S. Corp. v. Taylor, 525. 3. Wages of Seamen. Attachment. Exemption. Wages of master of vessel not exempt. Blackton v. Gordon, 91. ADVERTISING. See Constitutional Law, II, 7. AMBASSADORS. Intervention by ambassador as claimant of public vessel of friendly government. Compania Espanola v. The Navemar, 68. AMENDMENT. See Assignments of Error, 1; Limitations, 4; Statutes, 11. ANIMALS. See Interstate Commerce Acts, 3. ASSESSMENTS. See Banks, 3. ASSIGNMENTS OF ERROR. 1. Form. Requirements of rules of court; efïect of amendment of rules. Lonergan v. U. S., 33. 2. Sufficiency. Rulings made “in the progress of the trial.” Century Indemnity Co. v. Nelson, 213. ASSUMPTION OF RISK. See Safety Appliance Acts. 675 676 INDEX ATTACHMENT. Exemption. Wages of master of vessel not exempt. Blackton n. Gordon, 91. AUTOMOBILES. See Insurance, 2. State Régulation of weight and width of vehicles. S. C. High-way Dept. v. Barnwell Bros., 177. BANKRUPTCY. 1. Amendment of General Order LUI, relating to bond of de-pository, p. 671; order suspending operation of General Order LUI, p. 626. 2. Farmers. Authority and liability of conciliation commissioner; expenditure of proceeds of crop; disbursements subséquent to adjudication in bankruptcy; rights of mortgagee of crop and fann. Adair v. Bank of America Assn., 350. 3. Set-off. See McCollum n. Bank, 245. BANKS. See Bankruptcy, 1; Damages; Fraud, 1. 1. National Banks. Usury. Recovery of penalty; set-off. McCollum v. Hamilton Bank, 245. 2. Insolvency. Creditors. Claims of secured creditors; interest for period subséquent to insolvency. Ticonic Bank v. Sprague, 406. 3. Liability’of Stockholders. Validity and enforcement of assess-ments by Comptroller. Adams n. Nagle, 532. BILLS OF EXCEPTIONS. Settlement and Filing. Authority of appellate court under Criminal Appeals Rules. Kay v. U. S., 1. BONDS. See Bankruptcy, 1. BURDEN OF PROOF. See Evidence, 3. CALIFORNIA. See Treaties. CARRIERS. See Interstate Commerce Acts; Safety Appliance Acts. CATTLE. See Interstate Commerce Acts. 3. CERTIORARI. See Constitutional Law, V, (B), 12; Jurisdiction, II, 1. COLLUSION. See Jurisdiction, I, 16; Removal of Causes. COMPTROLLER OF THE CURRENCY. See Banks, 3. CONCILIATION COMMISSIONER. See Bankruptcy, 2. CONFISCATION. See Constitutional Law, V, (B), 9. CONFORMITY AOT. See Jurisdiction, I, 3. INDEX 677 CONSTITUTIONAL LAW. I. Miscellaneous, p. 677. II. Commerce Clause, p. 678. III. Contract Clause, p. 678. IV. Fifth Amendment, p. 678. V. Fourteenth Amendment. (A) In General, p. 679. (B) Due Process Clause, p. 679. (C) Equal Protection Clause, p. 680. I. Miscellaneous. 1. Powers of Congress. Validity of Home Owners’ Loan Act. Kay v. U. S., 1. 2. Id. Powers of National Labor Relations Board. Myers n. Bethlehem Shipbuilding Corp., 41; Newport News Co. v. Schauff-ler, 54. 3. Id. Scope of bankruptcy powers. Adair v. Bank of America Assn., 350. 4. Id. Public utility holding companies as within regulatory power. Electric Bond Co. v. Securities Comm’n, 419. 5. Délégation of Legislative Power. Kay n. U. S., 1. 6. Fédéral and State Relations. Territorial jurisdiction. Atkinson v. State Tax Comm’n, 20. 7. Id. Judicial Power. Validity of state court decree of escheat of funds in control of fédéral court. U. S. v. Klein, 276. 8. Id. State Taxation of income derived from contract with United States for construction. Id. 9. Id. Fédéral Taxation of profits of lessee of oil lands owned by State. Helvering v. Bankline Oil Co., 362. 10. Id. Fédéral Taxation of income received by lessee (or by cestui que trust under deed from lessee) of school lands granted to State by United States. Helvering v. Mountain Producers Corp., 376. 11. Id. Fédéral Taxation of compensation for services in connection with liquidation of insolvent corporation by state officer. Helvering v. Therréll, 218. 12. Full Faith and Crédit Clause. Legal effect of judgment of court of other State; how determined. Adam v. Saenger, 59. 13. State Régulation. Test of constitutionality. S. C. Highway Dept. v. Barnwéll Bros., 177. 678 INDEX CONSTITUTIONAL LAW—Continued. H. Commerce Clause. 1. Régulation Generally. Corporations can not escape by acting through subsidiaries. Electric Bond Co. n. Securities Comm’n, 419. 2. Scope. Contracts. Mere formation of contract between persons of different States not protected by commerce clause. Western Live Stock v. Bureau, 250. 3. Fédéral Régulation. Public utility holding companies; validity of registration provisions of Holding Company Act. Electric Bond Co. v. Comm’n, 419. 4. Id. Extent of power of Congress; unfair labor practices affecting commerce; manufactured articles; origin of raw mate-rial; place of sales; percentage of product moving in interstate commerce. Santa Cruz Co. v. Labor Board, 453. 5. State Régulation of weight and width of motor vehicles; interstate carriers. S. C. Highway Dept. v. Barnwell Bros., Y17. 6. State Taxation generally as burden on interstate commerce; increased cost of commerce. Western Live Stock n. Bureau, 250; Coverdale v. Pipe Line Co., 604. 7. Id. Privilège tax on gross receipts from foreign advertisers in journal circulated interstate. Western Live Stock n. Bureau, 250. 8. Id. Privilège tax on production of power used to transmit gas interstate. Coverdale n. Arkansas-Louisiana Pipe Line Co., 604. III. Contract Clause. 1. Police Power. Contracts subject to frustration by proper exercise of police power. Indiana v. Br and, 95. 2. Statutory Contract. Teachers’ Tenure. Right of teacher under Indiana Act was contractual and impaired by amendatory Act of 1933. Indiana v. Brand, 95. 3. Contractual Tax Exemption. Contract of public utility not violated by subséquent tax on gross receipts for relief of unem-ployed. N. Y. Rapid Transit Corp. v. New York, 573. IV. Fifth Amendment. 1. Criminal Statutes. Définition of offense; vagueness. Kay v. U. S., 1. 2. Double Jeopardy. Acquittai of criminal offense not bar to civil action based on same facts. Helvering N. Mitchell, 391. INDEX 679 CONSTITUTIONAL LAW—Continued. 3. Taxation of transfers reserving life estate. Helvering n. Bul-lard, 297. 4. Administrative Procedure. Proceedings before Labor Board; adequacy of judicial review. Myers v. Bethlehem Corp., 41. 5. Notice and Hearing. See Labor Board v. Greyhound Lines, 261. V. Fourteenth Amendment. (A) In General. 1. Municipal Ordinances as state action. Lovell v. Griffin, 444. 2. Validity of régulation of weight and width of motor vehicles using highways. S. C. Highway Dept. v. Barnwell Bros., 177. (B) Due Process Clause. 1. Liberty of Press. Scope. City ordinance forbidding distribution of literature of any kind without permission, invalid. Lovell v. Griffin, 444. 2. Foreign Corporations. Protection against subséquent application of state law. Connecticut General Ins. Co. v. Johnson, 77. 3. Id. Property and activities outside State may not be taxed. Id. 4. Id. Tax on insurance company measured by gross premiums from reinsurance effected outside State, though covering risks of other companies within State, invalid. Id. 5. Public Utilities. Taxation for relief of unemployed generally. N. Y. Rapid Transit Corp. v. New York, 573. 6. Public Utilities. Régulation. Rates. Due process in rate-making procedure. United Gas Co. v. Texas, 123. 7. Id. Trial by jury of complicated issues of fact in rate case. Id. 8. Id. Right of utility to hâve spécial issues framed and sub-mitted. Id. 9. Id. On trial of issue of confiscation, utility not entitled to hâve property not used or useful included in rate base. United Gas Co. v. Texas, 123. 10. Id. Fixing rate for future; considération of feturns from operations not limited to results of single year; estimâtes of future retums. Id. 11. Judicial Procedure. Judgments. Service of process. Adam v. Saenger, 59. 12. Remedies. Practice. Limitation of review by certiorari to questions of law did not deprive utility of due process. New York v. Maltbie, 158. 680 INDEX CONSTITUTIONAL LAW—Continued. (C) Equal Protection Clause. 1. Racial Discrimination. Exclusion of Negroes from jury. Haie v. Kentucky, 613. 2. Classification of Utilities for purposes of taxation. N. Y. Rapid Transit Corp. v. New York, 573. CONTRACTS. See Constitutional Law, II, 2; III, 1-3. Enfor cernent. Defenses. * Fraud. Deitrick v. Standard Surety Co., 471. CORPORATIONS. See Banks, 3; Constitutional Law, II, 1; V, (B), 2-4; Taxation, II, 4-6; III, 4—5. COUNTERCLAIM. See Bankruptcy, 3. COURT OF CLAIMS. Patent Cases. Review. U. S. n. Esnault-Pelterie, 26. CRIMINAL APPEALS RULES. 1. Application. Rules promulgated May 7, 1934, not applicable to District Court of Hawaii. Mookini v. U. S., 201. 2. Bill of Exceptions. Settlement and Filing. Authority of appellate court. Kay v. U. S., 1. CRIMINAL LAW. 1. Offenses. Violations of penal provisions of Home Owners’ Loan Act. Kay v. U. S., 1. 2. Double Jeopardy. Helvering N. Mitchell, 391. 3. Criminal Appeals. Bill of exceptions; authority of appellate court. Kay v. U. S., 1. CROSS-ACTION. Service of cross-complaint on attorney for plaintiff. Adam v. Saenger, 59. DAMAGES. See Seamen; Usury. Interest as Damages for failure of national bank to pay deposit on demand. Ticonic Bank v. Sprague, 406. DEATH. See Insurance, 1. DECLARATORY JUDGMENT ACT. Construction. Act may not be invoked to obtain advisory decree on hypothetical state of facts. Electric Bond Co. v. Comm’n, 419. DEPLETION. See Taxation, II, 7. DEPOSITORY. See Bankruptcy, 1. INDEX 681 DISABILITY. See War Risk Insurance, 1. DISTRICT ATTORNEYS. See United States, 2. DIVIDENDS. See Taxation, II, 5. DOUBLE JEOPARDY. See Constitutional Law, IV, 2. EMPLOYER AND EMPLOYEE. See Interstate Commerce Acts, 2; Seamen. 1. Labor Disputes. Jurisdiction of District Court in respect of injunction in labor disputes; existence of “labor dispute”; effect of Norris-LaGuardia Act. Lauf v. Shinner & Co., 323; New Negro Alliance v. Grocery Co., 552. 2. Labor Relations Act. Jurisdiction of National Labor Relations Board. Santa Cruz Co. v. Labor Board, 453. 3. Id. District Court without jurisdiction to enjoin Board from holding hearing. Myers v. Bethlehem Corp., 41; Newport News Co. v. Schauffler, 54. 4. Id. Power of National Labor Relations Board to order employer to withdraw récognition of labor organization. Labor Board n. Greyhound Lines, 261; Labor Board v. Pacific Lines, 272. EQUITY. Administrative Remedy. Myers v. Bethlehem Corp., 41. ESCHEAT. State court decree of escheat of funds in control of fédéral court. U. S. v. Klein, 276. ESTOPPEL. See Insurance, 3. EVIDENCE. 1. Judicial Notice. Law of State. Adam v. Saenger, 59. 2. Presumption that death accidentai, not suicidai. N. Y. Life Ins. Co. v. Gamer, 161. 3. Burden of Proof of accidentai death in action on double indemnity provision of insurance policy. N. Y. Life Ins. Co. n. Gamer, 161. 4. Sufficiency of Evidence as to possession of vessel by friendly government. Compania Espanola v. The Navemar, 68. 5. Sufficiency of Evidence of fraud. U. S. v. O’Donnell, 501. 6. Findings of Labor Board supported by evidence conclusive. Labor Board n. Greyhound Lines, 261. 7. Findings. Consistency. State Farm Ins. Co. v. Coughran, 485. 682 INDEX EXECUTION. See Attachment. EXEMPTION. See Admiralty, 1 ; Attachment ; Constitutional Law, III, 3; Taxation, II, 6. FARMERS. See Bankruptcy, 2. FINDINGS. See Evidence, 6-7; Jurisdiction, I, 18-19; II, 7. FOREIGN GOVERNMENTS. See Admiralty, 1. FOREIGN JUDGMENT. See Judgments, 5. FRAUD. See Taxation, II, 9. 1. Defense good against bank was good against receiver. Dei-trick v. Standard Surety Co., 471. 2. Sufficiency of Evidence. U. S. v. O’Donnell, 501. FREEDOM OF THE PRESS. See Constitutional Law, N, (B), 1. FULL FAITH AND CREDIT. See Constitutional Law, I, 12. GAS AND OIL. See Constitutional Law, I, 9. GOVERNMENTAL INSTRUMENTALITIES. See Constitutional Law, I, 8-11. GROSS RECEIPTS TAX. See Constitutional Law, II, 7; V, (B), 4. GUADALUPE HIDALGO. See Treaties. HAWAII. Criminal Appeals Rules not applicable to District Court for Hawaii. Mookini v. U. S., 201. HIGHWAYS. State régulation of weight and width of motor vehicles. S. C. Highway Dept. v. Barnwell Bros., 177. HOLDING COMPANIES. Validity of registration provisions of Public Utility Holding Company Act. Electric Bond Co. v. Securities Comm’n, 419. HOME OWNERS’ LO AN ACT. Validity and Construction of penal provisions; false state-ments; unauthorized charges. Kay v. U. S., 1. INFRINGEMENT. See Patents for Inventions, 3. INJUNCTION. 1. Restraining Enjorcement oj Statute. Exhaustion of administrative remedy as prerequisite. Myers v. Bethlehem Corp., 41. INDEX 683 INJUNCTION—Continuée!. 2. Interlocutory Injunction. Déniai ordinarily not disturbed on appeal; when rule inapplicable. Myers v. Bethlehem Corp., 41. 3. Injunction in labor disputes; effect of Norris-LaGuardia Act. Lauf n. Shinner & Co., 323; New Negro Alliance n. Sanitary Co., 552. INSOLVENCY. See Bankruptcy, 1-3; Banks, 2-3. INSURANCE. See Constitutional Law, V, (B), 4; War Risk Insurance, 1-2. 1. Life Insurance. Cause of Death. Double Indemnity. Bur-den of proof that death was accidentai and not suicidai. N. Y. Life Ins. Co. v. G amer, 161. 2. Automobile Insurance. Liability of insurer; defenses; operation of vehicle illegally; availability of defense. State Farm Ins. Co. v. Coughran, 485. 3. Estoppel. Insurance company not estopped from using defense which it did not disclose at earlier trial against insured. Id. INTEREST. See Banks, 2; Damages; Usury. INTERNATIONAL LAW. 1. Territorial Annexation. Property Rights. U. S. v. O’Donnell, 501. 2. Foreign Public Vessél. Immunity from suit; how immunity asserted; intervention of ambassador. Compania Espanola v. The Navemar, 68. INTERSTATE COMMERCE ACTS. 1. Authority of Commission. Approval of pooling agreement; assent of “carrier involved.” Escanaba & L. S. R. Co. v. U. S., 315. 2. Safety Appliance Acts. Defective Car. Liability of carrier to employée of connecting carrier. Brady v. Terminal Railroad Assn., 10. 3. Liability of Carrier for prolonged confinement of cattle in cars; “knowingly and willfully.” U. S. v. Illinois Central R. Co., 239. 4. Orders. Suit to Set Aside. Jurisdiction under Urgent Deficiencies Act; négative orders; railway mail pay. U. S. v. Grif-fin, 226. 684 INDEX INTERSTATE COMMERCE ACTS—Continued. 5. Id. Decision of Commission as to status of carrier for pur-poses of Railway Labor Act not order reviewable under Urgent Deficiencies Act. Shannahan v. U. S., 596. INTERVENTION. See Parties, 2. JUDGMENTS. See Constitutional Law, I, 12. 1. Validity. Service of cross-complaint on attorney for plain-tiff in original action. Adam v. Saenger, 59. 2. Res Judicata. Acquittai on criminal charge not bar to civil action. Helvering x. Mitchell, 391. 3. Id. Different issues in later suit. U. S. v. O’Donnell, 501. 4. Conclusiveness of confirmation of Mexican grant by Board of Land Commissioners. U. S. v. O’Donnell, 501. 5. Foreign Judgment. Enforcement. Full faith and crédit; inquiry into jurisdiction. Adam v. Saenger, 59. JUDICIAL NOTICE. Law of State. Adam v. Saenger, 59. JURISDICTION. See Admiralty, 1; Criminal Appeals Rules, 1-2. I. In General, p. 684. II. Jurisdiction of this Court, p. 685. III. Jurisdiction of Circuit Courts of Appeals, p. 687. IV. Jurisdiction of District Courts, p. 687. V. Jurisdiction of Court of Claims, p. 687. VI. Jurisdiction of State Courts, p. 687. References to particular subjects under title Jurisdiction: As-signments of Error, I, 17; Certiorari, II, 1; Collusion, IV, 6; Contract Clause, II, 19; Criminal Appeals Rules, III, 2; Declara-tory Judgment Act, I, 4; Fédéral Question, I, 9-12; II, 15-17; Final Judgment, II, 14; Findings, I, 18-19; Full Faith and Crédit, II, 12; Hawaii, III, 2; Injunction, I, 7; IV, 2-3; Interstate Commerce Commission, IV, 7-8; Judgments, II, 12; Jurisdictional Amount, I, 6, 14; II, 2; IV, 5-6; Labor Disputes, I, 7; IV, 3-4; Local Questions, I, 13; Moot Controversy, I, 7; Norris-LaGuardia Act I, 7; IV, 3-4; Opinion, II, 11; Patent Suits, V; Railway Labor Act, IV, 8; Record, II, 2; IV, 5; Removal, I, 14; IV, 6; Scope of Review, II, 3-7; State Courts, II, 8-19; VI, 1-2; Suit Against United States, I, 2-3; Urgent Deficiencies Act, IV, 7-8; Waiver, I, 16; IV, 1. I. In General. 1. Judicial Function in case involving constitutionality of state law. S. C. Highway Dept. v. Barnwell Bros., 177. INDEX 685 JURISDICTION—Continued. 2. Suit Against United States. Consent necessary. U. S. v. Griffin, 226. 3. Id. When maintainable ; United States attorney may not waive conditions; effect of Conformity Act. Munro v. U. S., 36. 4. Case or Controversy. Declaratory Judgment Act. Electric Bond Co. v. Securities Comm’n, 419. 5. Interférence by State Court with jurisdiction of fédéral court. U. S. v. Klein, 276. 6. Jurisdictional Amount. Henneford v. Northern Pacific Ry. Co., 17. 7. Injunction. Labor Disputes. Norris-LaGuardia Act. New Negro Alliance v. Grocery Co., 552; Lauf n. Shinner & Co., 323. 8. Moot Controversy. Newport News Co. v. Schauffler, 54. 9. Fédéral Question. What record must show as to fédéral question. S. W. Bell Tel. Co. n. Oklahoma, 206. 10. Id. Whether fédéral question was presented in state court is itself a fédéral question. Lovell v. Griffin, 444. 11. Id. Substantial fédéral question held not involved. New York v. Maltbie, 158. 12. Id. Legal effect of judgment under full faith and crédit clause. Adam v. Saenger, 59. 13. Local Questions. Construction of state law. Lauj v. Shinner & Co., 323. 14. Removal. Jurisdictional Amount. St. Paul Co. v. Red Cab Co., 283. 15. Appeal. Timeliness. Mookini v. U. S., 201. 16. Waiver. Lack of jurisdiction of subject matter can not be waived by parties. U. S. v. Griffin, 226. 17. Assignments of Error. Sufficiency. Rulings made “in the progress of the trial.” Century Indemnity Co. v. Nelson, 213. 18. Findings of Fact. Conclusiveness. Labor Board v. Grey-hound Lines, 261. 19. Findings. Consistency. State Farm Ins. Co. v. Coughran, 485. II. Jurisdiction of this Court. 1. Application for Certiorari not made in time. Kirkpatrick y. Hardt, 626. 2. Jurisdictional Amount. Détermination. Record. Henne-ford v. Northern Pacific Ry., 17. 686 INDEX JURISDICTION—Continued. 3. Scope oj Review. Question not raised below and not ade-quately based in record, not considered. Kay v. U. S., 1. 4. Id. Review of Court of Claims in patent suit; limited to questions of law. U. S. v. Esnavlt-Pelterie, 26. 5. Id. Determining constitutionality of state law. S. C. High-way Dept. v. Barnwell Bros., 177. 6. Id. Rulings made “in the progress of the trial.” Century Indemnity Co. v. Nelson, 213. 7. Concurrent Findings. U. S. v. 0’Donnell, 501. 8. Review of State Courts. When findings of facts will be re-viewed here. United Gas Co. v. Texas, 123. 9. Id. Fédéral Question. What record must show in respect of fédéral question. S. W. Bell Tel. Co. v. Oklahoma, 206. 10. Id. Where state court might hâve based its decision on adéquate state ground. Indiana v. Brand, 95. 11. Id. Opinion of state court may be examined to ascertain whether fédéral question was raised or decided; effect of certifi-cate of judges of state court supplementing record. Id. 12. Id. Legal effect of judgment under full faith and crédit clause was fédéral question reviewable here. Adam n. Saenger, 59. 13. Id. Oklahoma court’s déniai of rehearing after legislative proceeding held not reviewable here. S. W. Bell Tel. Co. N. Oklahoma, 206. 14. Dismissal for want of final judgment. Williams v. Quill, 621; Graves v. Board of Education, 622; Edgar Bros. Co. v. State Revenue Comm’n, 626. 15. Dismissal for lack of properly presented fédéral question. Kansas Farmers Co. v. Shaffer, 623. 16. Want of Substantial Fédéral Question. Dismissal. Rust v. Pratt, 621; Groves v. Board of Education, 622; Adler v. Cincinnati, 622; Szold v. Outlet Embroidery Supply Co., 623; Kansas Gas Co. v. McPherson, 624; Hering v. State Board. 624; Heller v. Connecticut, 627; Allbritton n. Winona, 627. 17. Non-federal ground adéquate to support judgment. Poole v. Florida, 619; Rust v. Pratt, 621. 18. Review of State Courts. Local Questions. Decision of state court final as to whether procedure satisfied state law. United Gas Co. v. Texas, 123. 19. Détermination of cases under contract clause; court décidés for itself questions as to existence and meaning of contract. N. Y. Rapid Transit Corp. v. New York, 573. INDEX 687 JURISDICTION—Continued. III. Jurisdiction of Circuit Courts of Appeals. 1. Scope of review on appeal in law case tried without jury. State Farm. Ins. Co. v. Coughran, 485. 2. Appeal from District Court of Hawaii; Criminal Appeals Rules inapplicable; time allowed by Act of Feb. 13, 1925, un-changed. Mookini v. U. S., 201. IV. Jurisdiction of District Court. 1. Lack of Jurisdiction of subject matter can not be waived by parties. U. S. v. Griffin, 226. 2. Injunction. District Court without jurisdiction to enjoin holding of hearing by National Labor Relations Board. Myers v. Bethlehem Shipbuilding Corp., 41; Newport News Co. v. Schauff-ler, 54. 3. Id. Injunction in labor disputes; existence of “labor dispute”; effect of Norris-LaGuardia Act. Lauf v. Shinner & Co., 323; New Negro Alliance v. Sanitary Co., 552. 4. Id. That dispute was racial did not remove it from scope of Norris-LaGuardia Act; “persons interested.” New Negro Alliance v. Sanitary Co., 552. 5. Jurisdictional Amount. Determined by bill of complaint; supplementing of record denied. Henneford v. Northern Pacific Ry., 17. 6. Removal from state court; jurisdictional amount; effect after removal of réduction of amount claimed; collusion. St. Paul Co. v. Red Cab Co., 283. 7. Id. Orders of Interstate Commerce Commission. Négative Orders. No jurisdiction under Urgent Deficiencies Act to set aside railway mail pay order. U. S. v. Griffin, 226. 8. Orders of Interstate Commerce Commission. Decision of Commission as to status of carrier under Railway Labor Act not order reviewable under Urgent Deficiencies Act. Shannahan v. U. S., 596. V. Jurisdiction of Court of Claims. Patent Suits. U. S. v. Esnault-Pelterie, 26. VI. Jurisdiction of State Courts. 1. Jurisdiction of state court to déclaré escheat of funds in control of fédéral court. U. S. v. Klein, 276. 2. Jurisdiction of California court where cross-complaint served on attorney for plaintiff. Adam v. Saenger, 59. 688 INDEX JURISDICTIONAL AMOUNT. See Jurisdiction, IV, 5-6. JURY. See Constitutional Law, V, (B), 7. LABOR RELATIONS ACT. 1. Jurisdiction of Board. Santa Cruz Co. N. Labor Board, 453. 2. Id. Board not invested with exclusive power to détermine own jurisdiction. Newport News Co. v. Schauffler, 54. 3. District Court without jurisdiction to enjoin Board from holding hearing. Myers v. Bethlehem Corp., 41; Newport News Co. N. Schauffler, 54. 4. Power of Board to order employer to withdraw récognition of labor organization. Labor Board v. Greyhound Lines, 261; Labor Board v. Pacific Lines, 272. 5. Labor Practices. “Affecting Commerce.” Trade in manu-factured articles; origin of raw material; place of sales; per-centage of employer’s sales in interstate commerce; relation of practices to interstate commerce. Santa Cruz Co. v. Labor Board, 453. 6. Orders. Sufficiency of evidence and findings to support or-ders. Labor Board n. Greyhound Lines, 261; Labor Board v. Pacific Lines, 272. 7. Controversy held not moot. Id.; Labor Board v. Greyhound Lines, 261. LABOR UNIONS. See Labor Relations Act. LEASES. See Constitutional Law, I, 9-10; Taxation, II, 2. LIBERTY OF THE PRESS. See Constitutional Law, V, (B), 1. LIENS. See Banks, 2. LIFE INSURANCE. See Insurance, 1. LIMITATIONS. 1. Timeliness of Suit in Court of Claims for tax refund. Bâtes Mfg. Co. v. U. S., 567. 2. Id. When period begins to run; suit to recover erroneous refund of taxes. U. S. N. Wurts, 414. 3. Suit against United States on War Risk Insurance policy in District Court not begun in time. Munro v. U. S., 36. 4. Amendment of Complaint. New cause of action held not introduced by amended complaint. Maty v. Grasselli Co., 197. LIVESTOCK. See Interstate Commerce Acts, 3. INDEX 689 MAIL. Railway Mail Pay. Suit to set aside order of Interstate Commerce Commission. U. S. v. Griffin, 226. MAINTENANCE AND CURE. See Seamen. MARE ISLAND. See Title. MASTER AND SERVANT. See Labqr Relations Act; Safety Appliance Acts; Seamen. MEXICAN CLAIMS ACT. Effect of confirmation of title under Act. U. S. v. O’Donnell, 501. MOOT CONTROVERSY. See Jurisdiction, I, 8; Labor Relations Act, 7. MORTGAGES. See Bankruptcy, 2. MOTION TO DISMISS. See Pleading, 2. MOTOR VEHICLES. State régulation of weight and width. S. C. Highway Dept. v. Barnwell Bros., 177. MUNICIPAL CORPORATIONS. See Constitutional Law, V, (A), i; v, (B), 1. NEGLIGENCE. See Safety Appliance Acts. NEGROES. See Constitutional Law, V, (C), 1; Jurisdiction, IV, 4. See New Negro Alliance n. Grocery Co., 552. NEWSPAPERS. See Constitutional Law, II, 7. NORRIS-LaGUARDIA ACT. See Jurisdiction, I, 7; IV, 3-4. OIL AND GAS. See Constitutional Law, I, 9; Taxation, II, 2. OPINIONS. Opinion of state court may be examined to ascertain whether fédéral question was raised or decided. Indiana v. Brand, 95. ORDINANCES. See Constitutional Law, V, (A), 1; V, (B), 1; Statutes, 4. PARTIES. 1. Necessary Parties. See Labor Board v. Greyhound Lines, 261. 2. Intervention by ambassador as claimant of public vessel of friendly government. Compania Espanola v. The Navemar, 68. PARTNERSHIP. See Taxation, II, 3. §3383°—38--------44 690 INDEX PATENTS FOR INVENTIONS. 1. Validity. Combinations. Improvement of part of old combination. Lincoln Co. v. Stewart-Warner Corp., 545. 2. Id. Patent No. 1,593,791, to Butler, for lubricating appa-ratus, void. Id. 3. Proceedings. Suit in Court of Claims for infringement by United States; findings; review. U. S. v. Esnavlt-Pelterie, 26. PENALTIES. See Banks, 1; Taxation, II, 9; Usury. PERSONAL INJURIES. See Safety Appliance Acts. PLEADING. See Limitations, 4; Safety Appliance Acts. 1. Service of cross-complaint on attorney for plaintiff in original action, authorized by California law. Adam v. Saenger, 59. 2. Motion to Dismiss. Conclusions of law not admitted. New-port News Co. v. Schauffler, 54. 3. Variance of Evidence. Deitrick v. Standard Surety Co., 471. PRESUMPTIONS. Presumption that death was accidentai and not suicide. N. Y. Life Ins. Co. v. Gamer, 161. PROCEDURE. See Constitutional Law, IV, 4; V, (B), 11-12. 1. Commencement of Suit under Tucker Act. Munro v. U. S., 36. 2. Patent Suit in Court of Claims. U. S. v. Esnavlt-Pelterie, 26. 3. Bill of Exceptions. Timeliness. Authority of appellate court under Criminal Appeals Rules. Kay v. U. S., 1. 4. Assignments of Error. Form. Lonergan v. U. S., 33. 5. Validity of rate-making procedure. United Gas Co. v. Texas, 123. 6. Where state court’s decision of fédéral question in favor of défendant was erroneous, case remanded for decision on other grounds of demurrer. Indiana n. Brand, 95. PROCESS. 1. Immunity of public vessel of friendly government. Compania Espanola v. The Navemar, 68. 2. Validity under California law of service of cross-complaint on attorney for plaintiff. Adam v. Saenger, 59. PUBLIC LANDS. Title of United States to part of Mare Island as affected by Swamp Lands Act. U. S. v. O’Donnell, 501. INDEX 691 PUBLIC UTILITIES. See Constitutional Law, III, 3; V, (B), 5-10; V, (C), 2. 1. Validity of registration provisions of Holding Company Act. Electric Bond Co. v. Comm’n, 419. 2. Rates. Procedure. Validity of rate-making procedure; confiscation; property not used or useful; rates for future; returns from operations; estimâtes of future returns. United Gas Co. v. Texas, 123. 3. Taxation for relief of unemployed generally. N. Y. Rapid Transit Corp. v. New York, 573. RAILWAY LABOR ACT. See Jurisdiction, IV, 8. RAILWAY MAIL PAY ACT. See Jurisdiction, IV, 7. RECEIVERS. Actions by Receivers. Contracts. Defense. of fraud, good against bank, was good against receiver. Deitrick v. Standard. Surety Co., 471. REGISTRATION. See Public Utilities, 1. REINSURANCE. See Constitutional Law, V, (B), 4. REMOVAL OF CAUSES. Jurisdictional Amount in cases of removal from state to fédéral court; effect after removal of réduction in amount claimed; collusion. St. Paul Co. n. Red Cab Co., 283. RES JUDICATA. See Judgments, 2-5. RETROACTIVE LAWS. See Statutes, 8. RULES OF COURT. See Criminal Appeals Rules. Application of Rules. Amendment. Lonergan v. U. S., 33. SAFETY APPLIANCE ACTS. Liability of Carrier. Defective Car. Car as one “in use”; employée of connecting carrier; inspector entitled to benefit of Act; defense of assumption of risk barred. Brady v. Terminal Assn., 10. SCHOOL LANDS. See Constitutional Law, I, 10. SCHOOLS. Indiana T cacher s’ Tenure Act. Construction and effect. Indiana v. Brand, 95. SEAMEN. See Admiralty, 3. Right to maintenance and cure; incurable illness not caused by employment; amount of recovery. Calmar S. S. Co. v. Taylor, 525. 692 INDEX SEPARABILITY. See Statutes, 9. SERVICE OF PROCESS. See Process, 1-2. SET-OFF. What Claims May be Set Off. McCollum v. Hamilton Bank, 245. SHIPPING. See Admiralty, 1-3. STATUTES. See Injunction, 1. 1. Validity. Determining constitutionality of state law; judi-cial function. S. C. Highway Dept. v. Barnwéll Bros., 177. 2. Id. Wisdom and propriety of law not for détermination of courts. Id. 3. Challenging Validity. Exhausting administrative remedy. Myers v. Bethlehem Corp., 41. 4. Id. Proseeution under ordinance which is void on its face. » Lovell n. Griffin, 444. 5. Penal Statutes. Vagueness. Kay N. U. S., 1. 6. Construction. Legislative history. Electric Bond Co. v. Securities Comm’n, 419; Hassett n. Welch, 303. 7. Id. Administrative interprétation. Hassett n. Welch, 303. 8. Id. Law presumed to operate prospectively only. Hassett v. Welch, 303. 9. Id. Separability. Kay v. U. S., 1; Electric Bond Co. n. Securities Comm’n, 419. 10. Id. Tax Statutes. Doubts resolved in favor of taxpayer. Hassett v. Welch, 303. 11. Amendment s. Adoption of provisions of other statute; effect of amendment of earlier one. Hassett v. Welch, 303. 12. Particular Words. Meaning of “knowingly and wilfully.” U. S. n. Illinois Central R. Co., 239. STOCKHOLDERS. See Banks, 3. SUICIDE. See Insurance, 1. SWAMP LANDS ACT. Construction and Effect. Treaty obligations. U. S. v. O’Donnell, 501. TAXATION. I. In General, p. 693. II. Fédéral Taxation, p. 693. III. State Taxation, p. 693. INDEX 693 TAXATION—Continued. I. In General. 1. Construction of tax statutes. Hassett v. Welch, 303. 2. Contractual Tax Exemption. Language must be clear and express. N. Y. Rapid Transit Corp. v. New York, 573. II. Fédéral Taxation. 1. State Instrumentality. Income tax on compensation for services rendered in connection with liquidation of corporation by state officer. Helvering v. Therrell, 218. 2. Id. Tax on profits of lessee of oil and gas lands owned by State. Helvering n. Bankline Oil Co., 362; Helvering v. Producers Corp., 376. 3. Income Tax. Computation. Partnership profits; accounting periods; taxable year. Guaranty Trust Co. v. Comm’r, 493. 4. Id. Earnings accumulated by corporation prior to March 1, 1913, deemed capital. Foster v. U. S., 118. 5. Id. Dividende. Distribution in partial liquidation as affect-ing taxability of subséquent distributions under § 115 of 1928 Act. Id. 6. Exemptions. Corporate Réorganisation. Gain resulting from assumption of bonded indebtedness by another corporation, not exempt. U. S. v. Hendler, 564. 7. Id. Profits from oil and gas wells; déduction for déplétion; depletable interest; meaning of “gross income from the property.” Helvering v. Bankline Oil Co., 362; Helvering v. O’Donnell, 370; Helvering v. Elbe Oil Land Co., 372; Helvering v. Mountain Producers Corp., 376. 8. Estate Tax. Application of estate tax to transfers reserving life estate; rétrospective operation. Helvering v. Bullard, 297; Hassett v. Welch, 303. 9. Penalties. Fraud. Assessment and collection of 50% addition prescribed by § 293 (b) not barred by acquittai of attempt to évadé tax under § 146 (b) of 1928 Act. Helvering n. Mitchell, 391. 10. Limitations. Suit to recover taxes illegally exacted. Bâtes Mjg. Co. v. U. S., 567. 11. Id. Suit to recover erroneous refund of tax. U. S. v. Wurts, 414. III. State Taxation. 1. State Tax on income derived from contract with United States. Atkinson v. State Tax Comm’n, 20. 694 INDEX TAXATION—Continued. 2. Interstate Commerce. Coverdale v. Arkansas-Louisiana Co., 604. 3. Id. Privilège tax on gross receipts from foreign advertisers in journal circulated interstate. Western Live Stock v. Bureau of Revenue, 250. 4. Foreign Corporations. Insurance Companies. Tax on insurance company measured by gross premiums from reinsurance effected outside State, invalid. Connecticut General Ins. Co. v. Johnson, 77. 5. Public Utilities. Tax on gross receipts of utilities for relief of unemployed. N. Y. Rapid Transit Corp. n. New York, 573. TEACHERS TENURE. Construction and effect of Indiana Teachers’ Tenure Act. Indiana v. Brand, 95. TERRITORIAL JURISDICTION. See Constitutional Law, I, 6. TITLE. Validity of title of United States to part of Mare Island. U. S. N. O’Donnell, 501. TRANSFERS. See Taxation, Tl, 8. TREATIES. Guadalupe Hidalgo. Obligations of United States in respect of swamp lands in California, as affected by treaty. U. S. v. O’Don-nell, 501. TRIAL. Findings. Consistency. State Farm Ins. Co. v. Coughran, 485. TRUCKS. See Constitutional Law, II, 5. TRUSTS. See Constitutional Law, IV, 3. Effect of trust instrument. Helvering v. Bullard, 297. UNEMPLOYMENT. See Taxation, III, 5. UNITED STATES. 1. Rights. Territorial jurisdiction; lands purchased within State; effect of cession of jurisdiction by State. Atkinson v. State Tax Comm’n, 20. 2. Suits Against. United States attorney may not waive conditions. Munro v. U. S., 36. UNITED STATES ATTORNEY. See United States, 2. USURY. Penalty. Recovery; set-off. McCollum v. Hamilton Bank, 245. INDEX 695 VARIANCE. See Pleading, 3. VESSELS. See Admiralty, 1-3. WAIVER. See Jurisdiction, I, 16. Authority of U. S. Attorney. Munro v. U. S., 36. WAR RISK INSURANCE. 1. Reinstated Policy. Disability. Claim incontestable though permanent total disability existed prior to reinstatement. U. S. v. Patryas, 341. 2. Suit. Limitations. Munro v. U. S., 36. 44