NEW CIIES'l.'ER WATER 00. V. HOLLY· MANUF'G (;0.
23
sum of $50,000; payable$8,331t33 on each engine when delivered in Chester, and the like sum on each engine when it has been properly run 80 days, and the like sum on each engine 80 days thereafter. The contract contains the following clause: "When said engines and connections are completed and ready for service, and on notice thereof to the party of the first part (Bullock & Co.) to that effect. the same shall be subjected to a fair trial of their capacity and efficiency for not exceeding twenty-four hours, and on the successful testing thereof the liability of the party of the second part (Holly Company) hereunder shall cease and determine. bnt it is expressly understood and agreed that the party of the second part shall have a lien on all of said engines and connections, and the party of the second part. may remain in and have full possession thereof until the whole amount of the purchase price of said engines and connections shall have been fully paid to the party of the second part or its assignee." One payment only. namely, the sum of $8,333.33. was made to the Holly Company under its contract. and at the date of the bringing of this suit the balance, or sum of $41,667. was due that company on said engines. On October 26.1887, a tripartite agreement was entered into between Samuel R. Bullock & Co., R. D. Wood & Co., and William G. Hopper & Co., whereby, aCter reciting contracts between Bullock & Co. and Hopper & Co. for advances by the latter tothe former upon a pledge of bonds and stocks of water companies, and assignme!ut8 by Bullock & Co. to Wood & Co. of the bonds and stock so pledged as collateral security for materials that they had furnished. and contracts be-I tween Bullock & Co. and Wood & Co.· by which the latter had undertaken to complete waterworks at Chester. Greencastle. and Mobile. and the representation by Bullock & Co. that $200.000 would enable them to complete those works. William G. Hopper & Co. agreed to advance to Bullock & Co. $200.000, the same to be applied by Wood & Co. to the completion of the waterworks at the three named places in certain specified proportions. Wood & Co. to present to Hopper; & Co. the detailed applications by Bullock & Co. for money as needed. and Hop·1 per & Co. thereupon to furnish such amounts (within the limit stated) to Wood & Co., who should give their checks for the same to Bullock & Co.. who should disburse the moneys for the purposes aforesaid; and. in consideration of this ad·! vance by Hopper & Co., Wood & Co. a.¥reed to procure' the completion of the waterworks at the three named places. clear of all liens ahead of the securities held by William G. Hopper & Co." Under this agreement Hopper & Co. ad-' vanced the $200.000, which was all applied to the waterworks at the three named places. but not in the proportions mentioned in the contract. The specified amount applicable to the works at Chester was $129.800. whereas the sum actually applied was $61.000 only. But the representation by Bullock & Co. that $200,000 would suffice to complete the works at the three places proved to be incorrect, for. besides the money so advanced by Hopper & Co.· Wood & Co.· in the completion of these works, used $105,000 of their own money. and even then the balance of $41.667 due the Holly Company on the pumping engines at Chester was left unpaid. and also $25,000 due that company on engines at Mobile. All the advances by Hopper & Co. under the tripartite agreement were made before the latter part of January, 1888, except a trifling sum, which was paid shortly afterwards. In October, 1887, the Holly Company shipped one of the pumping engines to Chester. and in February. 1888. the other. Each was consigned to that company itself. and its agents at Chester received the engines. and proceeded, at its expense, to put them in place. They were set on the top of masonry foundations. and were attached thereto by a number of two-inch iron bolts. They could not be operated or tested otherwise. The engines stand in a brick building erected on land which the South Ward Waterworks Company agreed to sell and convey to the New Chester Water Company. but actually conveyed to Samuel R. Bullock. who conveyed the same to H. S. Hopper for the purpose Bet forth in the paper executed by the latter, as already mentioned. Each engine weighs from !thout 70 to 80 tons. but they can easily be disconnected from the foundations on which they rest without disturbing the foundations. and can readily be taken apart and through the door of the engine house without injury to the buildinl('. When the first engine was shipped to Chester. John Lockman. by order of the Holly Company. and as its agent. went there to superintend the erection of the engines. and to take charge and control thereof. Tbis he did. remaining constantly in charge. The work of setting them up and ready· for service was not completed until Bome time in July, 1888, but for the delay the Holly Company was not responsible.
2>4:
FEDERAL REPORTl!:R.
vol. 53.
From the. time the first engine was gotfn working order Lockm$Dacted as ,englqiaintainedthe,exclusive charge and custQdy of both engines. He has.AOol1rfed "key to the .. His wages .have all been paid by the Holly Company, and he has acted throughont as its agent. No fo.rmal test of the pump· ing cap.lWity ,of:tbeengines,'&s provid"d by the contract, was ever made; nllr was therll anyfm,n:1l1.1acceptance of them by anyone. When ready. they were set to work pumping water into the reservoir, and have continued to do so under Lock· rnan'sCQ,l1trol. It is shown t11at explicit instruction was given by the Holly Com· to hold possession of the engines for that,company, but the, exact does not ,apPear. Lockman states that it was given about midsurnqier,: ·. Samuel R. Bullock, referring to conversations he had with the omeara QI,',representatives of thll Holly Company,testlfie,d thus: "They told me proposed to have :{Jockman remain there as their representative in charge of the pumps. but they didn't want to interfere the operations of the comJilll,Qy,'sO,be could act aseJ:\gineer and run the punwsright along;" and Mr. BullpclG f:qrtbllr testified that ,he ,cOnsented to Lockman's relIlllining in possession and charge. as desired by the Holly Company. The bill in this case was filed Septemlilar 19,1888. while Lockman was still incontrol of the pumping engines, In Novemh!ll',1888. Bullock & 00. assigned their entire remaining interest in the bonds lWd st,ock of the New Chester WaterOompany,tq Wood & Co.· and at the fla.metimede!Jvored to them 'rellignations of the officers. the water company. Thereupon new,:olJIcers were elected, and the water company then tOQk the actual pO,ssessionof tl:!ll,works, hut Lpckma.n's control ofthe eng-ines continued. Hopper, & Co.] and Wood &i Co. together hold substantially the entire mortgage bond iSllue of, $50Q,OOO of the New Ohellter Water Compflny: 16 bonds of $1,000 each are held by Dyer & Black, under a. pledge made in July, but only to indemnify them against a clai1D which the water compa.ny itself. may have I1gainst .. them as sureties. Bullock & 00., touching a lien of $15,000 Wh.iCh they were to. remove. All tbe:bonds and stock of the New.Chester Water OomJ,lany which Bullock & CQ.:wierl;l to rec,eive under their construction contract had been deliv· before the tirst pumping engine reached .Chester, and cer· er.ed to theqi before itll l;!!.'ection begl}n. On March 31, l890, Samuel R. Bullock and wife executed, and. deJi,yl;lrlld to the,N;ew Chellter Water Company adeedof can veyance of the land UPo,ll :which the engine hO,use at\d pumping engines stand. Upon th.is of facts by the court, a decree was entered on the 12th of October, 1891.dj'!IJ.issing. tbe bm as to R. D. Wood & Co. so far as it sought to establisban indiVidual liability against that firm, and sustaining- the lien of the Holly tho pumping engines; fixing t;he balance of the purchase moneY due upon the said engil1es and remaining unpaid at the sum of $41,667, With.interest therepn from the 11th day of August. 1888; and further OI:liering that, unless the defendants, or .some of them, shall, on Qr hefore the 23d dll.yof November next, pay to the plaintiffs the amounts found due them, then the sai,dengine,./!tud their.app'Uances, etc.. to be sold at public sale on at least three weeks' notice, etc.; whereupon the defendants the New Oheste.. Water ComPany andD. R. Wood & Co. prayed an appeal to this court, and through their counsel have filed the following assignments of error: . , ,First. The learned court erred in holding that "upon the whole case, then, we are of the opinion that the contractual lien of the Holly Manufacturing Company upon the pumping engines here in question is valid and binding, and is enforceable in this suit. " . ' ... . ' Second. The learned court erred in holding that Samuel R. Bullock and Wile Ham S. Mercer, tradi;ng as Samuel R. Bullock & Co., were not ;necessary parties defendant to the cause. Third: The learned court holding; "So far as the bill.seeks to enforce the Holly Company's lien, it IS manifest that there is no dispute between the company and Bullock &00. Samuel R. Bullock.indeed, was one of the principal witnesses in the case on hehalf of the Holly Company to establis4 its lien, and henc.e a decree in its favor would conclude. him and his firm. if there was any open question on that subject affecting them. But tbere is no such open ques'The Holly Company is .not seeking any relief. and needs no decree against Bullock & Co, Jt is urged, indeep, tbat that compllny is as for a foreclosure with ant making its debtor, who is the. owner ofthe property, a. party defendant; but this is a mistaken view. The 'ownership of the engines is not in. Bullock & Co., and, in truth, was never intended to be in them. for in the pur· chase they acted in the interest and behalf of tile New Chester Water Oompany. But can be no longer any pretense of ownex:ship in Bullock & Co., for Sam·
NEW CHESTE'R WATER CO; V. HOLLY MANUF'G CO.
25
nel Bullock, by his deed, has conveyed'the title to. the real. estate to the wa' ter'company. It is laid down in Jones on Mortgages(volume 2. \:I in an equitable suit for. foreclosure .the m9rtgagor. after he has conveyed the whole of the premises mortgaged, is riot a necessary party to' the suit. Moreover, Bul· lock & Co. have assigned 611 their ,interest in the bonds and stock of the water company to Wood & Co.; therefore they have no longer any interest, near or reo mote. in this Tbey are altogether formal parties, whose presence does not oust the jurisdiction of the court, coming within the rule laid' down in Wormley v. Wormley, 8 Wheat. 451, where the applied test was whether a decree was sought against the party. Here the Holly Company seeks to enforce a charge in rem, and Bullock & Co. have neither title to nor interest in the thing." . . Fourth. The learned court erred inholding that the Farmers' Loan & Trust Company was not a necessary party defendant to the cause. Fifth. The learned court erred in saying to the objection that the Farmers' Loan & Trust Company is not joined as a. defendant in this suit: "It is sufficient to say that, as sUbstantially the whole body of bondholders is before the court. the presence of their trustee is wholly unnecessary. Moreover, the enforcement of the Holly Company's specific lien does not involve the validity of the trust mortgage. nor affect its standing as respects the principal mortgaged thing, the controversy relating to a mere incidental matter. Again, as the joinder of the trust company might oust the jurisdiction of the court, the omission to make it a party defendant is fully warranted by equity rule 47. " Sixth. The learned court erred in holding: "But, in truth, with respect to this transaction, the distinction between Bullock & Co. and the water company is purely formal and fictitious. Bullock & Co. were the water company in every· thing but name. They really held the entire capital stock. Now, no court has ever yet decided that an incorporated company in this artificial capacity can be deemed to be ignorant of a matter affecting the company which is known to every individual stockholder. In our judgment. to treat the water company as a bona fide purchaser or possessor of the engines without notice of the contractual lien of the Holly Company would be unreasonable and unjust. The water com· pany cannot honestly retain the engines without paying the balance of the pur· chase price. " Seventh. The learned court erred in holding that the contractual lien of the Holly Manufacturing Company was effective after the pumping engines had been delivered and put into operation upon the property of another. Eighth. The learned court erred in holding that the lien of the mortgage made by the New Chester Water Company to the Farmers' Loan & Trust Company of New York. dated April 1, 1887, did not attach to the pumping engines when they were placed upon the mortgaged premises. 1\ inth. The learned court erred in directing a sale of the pumping engines upon which complainant asserted a lien without the prior entry of a decree in personam against Samuel R. Bullock & Co. ,who, by the undisputed evidence in the cause, were primarily liable to the Holly Manufacturing Company for the debt, to secure payment of which the sale is ordered.
R:
Richard C. Dale and Samuel Dickson, for R. D. Wood & Co., appellants, William Ward, for the New Chester Water Co., appellant. Rowland Evans, R. L. Ashhurst, and L. F. & G. W. Bowen, for appellees. Before DALLAS, Circuit Judge, and WALES and GREEN, District Judges. WALES, District Judge, (after stating the facts.) ON THE QUESTION OF JURISDICTION.
the demurrer to the bill, the jurisdiction of the circuit court would have been OllSted. because the individual members of that firm.were
If Bullock & Co. had been made parties defendant, as suggested by
FEDlllB)4LnpORTER,
ci1;ke.otthe same state with the Holly Company. But, as there or mai;1;er ?etween the Holly B.ullock the, firm/defendants, and they W1ere thel'elore;made.cQPJainti1rs .only fol' the bill, of investing "the of ,the so that aioomplete decree proteeJtmgtherlghts of aU parties can Oe The·firm had divested'themselv81of all mterestin the bonds and stock of the water cOnlpJinfesby their assigri:rb.en.ts to Wood & Co. and to Perrott, and on March 30, 1890, Samuel R.Bullc;lck and wife had conveyed to the New Clj.ester Water Oompany'the land upon which the engine house and 'p#wPtiig' engine' stan(i: ,In addition, to this, the amount due by t lthe I[oIlt;Company qa(j; been reducooto a judgment by' confession,'so that tJherewas no dispute about the indebtedness of .. Under these circumstances, it is evident that· &. Co. l;tre ;no' more than;,n;ominal parties. ,No relief is sought."agamst, them, of the bill being to enforce the com, plainan-m' lien in rem jand :the rule is well settled that the assignor of. with his interest in mortgaged ; Ilil Jilota party to a foreclosure bill. 2 Jones, Mortg.§ 1404. Under the rule laid down in Wormley v. Wormley, 8 Wheat.:451, it would seem that Bullock& Co. might have been joined as depriving the court below, of jurisdiction. In that case Wormley was madeone of the defendants to the suit, and his wife andnij,nor children were plaintiffs, so that all the parties on each side of'the cause were not citizens of different states; but the court held that Wormley was but a nominal defendant, joined for the sake of conformity in the bill, against whom no decree was sought. voluntarily. 1;hough Perhaps he could not have been compelled so to do, and the .court would not suffer its jurisdiction to be ousted by the mere joinderior nonjoinder of formal parties, but rather proceed without them, and decide upon the merits of the case between the partieswhb had the real. interests before it, whenever it CQuid be done withou1i,pl'ejudice to the rights of others. In Kerr v. Watts, 6 Wheat. 559, the court, in describing the necessary parties in equity, said: "No one need be made a party complainant in whom there exists no b;ltje!'est, and no one a party defendant from whom nothing is demanded." lJ'he pumping engines had never been delivered to or accepted by & Co.,. and no ownership had been vested in, Qlltimed, orexer(jised by that firm. The engines were intended to be, when paid for, the property of the New Chester Water Company. . The objection. that the. Farmers' Loan & Trust Company was not j()ined a8' a. .defendant· is perhaps still less tenable. That company was the trustee of the bondholders, but, as substantially all of thelattel' were before the court, the appearance of their trustee was not necessary. The enforcement of the complainants' lien on the engines will not affect the validity of the trust mortgage which attaches to the land, and not necess8,'r11y to the personal property which may be found thereon. But, if there was any doubt as to the necessity of making the trust company a party it would be removed by the application of equity rule 47, which provides that "in all cases
NEW CHESTER WIATER CO.
v.
HOLLY, :MANUF'G CO.
27,
where it shall appear to the court that persons who :might otherwise be deemed necessary or proper parties to the suit cannot be made par. ties by reason of their' being out :of the jurisdiction' of, the court, or incapable otherwise of .being made parties, or because their joinder would oust the jurisdiction of the court as to the parties before the court,the court may, in their discretion, proceed in the cause without making such persons parties; and in such cases the decree shall be without prejudice to the rights of absent parties." This rule is declaratory of the previous decisions of the supreme court on the subject. 'rhe general rule as to parties in chancery is that persons falling within the definition of "necessary parties" must be brought in for the purpose of putting an end to the whole controversy, or the bill will be dismissed; but in the federal courts this rule has been relaxed, result· ing from two causes: the limitation imposed upon the jurisdiction of these courts by the citizenship of the parties; and, secondly, their inability to bring in parties, out of their jurisdiction, by publication. Notwithstanding this rule, a circuit court can make no decree affecting the rights of an absent person, and all persons whose interests would be directly affected by the decree are indispensable parties. Chadbourne v. Coe, 51 Fed. Rep. 481. But the Farmers' Loan & Trust Company does not belong to this category. ON THE QUESTION OF LIEN.
The counsel for the appellants rely on their ignorance of the con· tract between the Holly Company and Bullock & Co. by which a lien on the engines was reserved. The evidence shows that, to whatever extent the other parties defendant may have ,been ignorant of the lien, the New Chester Water Company must have had knowledge of the contents of the contract of August 3, 1887, for, prior to that date this company had become virtually identical with Bullock & Co., and was subject to the control and management of that firm for all practical purposes. The officers and directors of the water company were the a.gents and servants of Bullock & Co., and some of the directors had personal knowledge of the terms of the contract. From the time when the engines were delivered at Chester, consigned to the Holly Company, they remained in the exclusive possession of that company, through its agent, John Lockman, whose wages were paid by the company, and who was instructed to retain possession of the property. These facts were open to the observation, and must have come to the knowledge, of the water company. The precise date when Hopper & Co. and R. D. Wood & Co. first acquired knowledge of the lien is a matter of dispute, but it sufficiently appears that they had intimate business relations with Bullock & Co. in reference to the loans of large sums of money to be applied to the construction of the waterworks at Chester; and the tripartite agreement of October 26, 1887, between the three firms, provided that these waterworks should be completed clear of all liens prior to the securities held by Hopper & Co. Samuel R. Bullock testified that he gave to Hopper & Co. and to R. D. Wood & Co. typewritten copies of the contract of August 3,1887, of which the latter say they have no recollection, but the probabilities are strongly in favor of the truth of Bullock's statement. Apart from
28
FEDERAL REPORTER,
thiS, there is nothing in the history of these transactions ..:rom which it can be inferred that either Hopper & Co. or Wood & Co. advanced money or gave credit to Bullock & Co. on the faith of the engines, or under the belief that they would constitute a part of the real property of the water company. But it is contended that it would be against the policy of the law to enforce the lien against an integral part of the property of a pp.blic corporation, and in support of this proposition reference is made to the case of Foster v. Fowler, 60 Pa. St. 27, in which the court decided that the buildings, etc., of such a corporation, necessary for carrying on its operations, are not 'subject to a mechanic's lien. In that case the plaintiff attempted to enforce a statutory mechanic's lien, which, if effectual at all, covered not only the machinery and building containing it, but also the entire premises on which they stood. Here the Holly Company claims a oontractual lien on a specific piece of property, which,in fact, had not been delivered to or accepted by the water company' before the filing of the ·bill, September 19, 1888, and which up to that time had not become a part of the real estate. The Holly Company had not parted with its possession of the engines which .had been placed On foundations for trial, to test their capacity and efficiency, and, they proved to be defective, would have been removed and thrown back on. the .vendor's hands. By attaching the engines to the foundations the Hotly Company did not intend to waive their lien, which ithey continued to maintain by actual possession The sale to Bullock & Co. was not an absolute one, the lien was not a secret one, aild up to the filing of the bill possession in fact: of the property had not. passed to the water company. It is conceded that the validity of the lien depends on the laws of Pennsylvania, and an examination Qfthe judicial decisions of that state will put at rest any doubt that may be entertained on this subject. .These 1ilecisions hold that ,the intention of the parties to the oontract is the main thing, to be considered in deciding whether they meant to give the vendor alien on the property sold. Thus, in Shell 'V. Haywood; 16 Pa. St. 523, where manufacturers had fixed parts. of maohinery in a.buildingattached to a mill, the owner of the latter, becoming embarrassed; agreed that the boilers and the machinery attached or to be attached' to them were the property of the manufacturer,s, who were to be left to their legal remedy for the materials already furnished, or to the removal.of the same at their option; and the court held that, as the parties had agreed that the property sold to the mill owner should be considered as personal property, it was immaterial whether or not, or in what manner, it was attached to the realty. In Hill v. Sewald, 53 Pa. St,. 271, the court said that it was not the physical character of the connection with the realty which constitutes the criterion of annexation, but the intention to annex, whether rightfully or wrongfully, is the true legal criterion. In Vail v. WeaV'er, 132 Pa. St. 363, 19 Atl. Rep. 138, it was decided that the engine, machinery, and appliances of an electric light plant do not pass, with the real estate upon which it is operated, to the purchaser of the realty, at a. sale under a mortgage judgment, unless it was the intention to make the plant a part of the realty when it
NEW CHESTER WATER CO.
HOLLY MANUF'G CO.
29
was erected. If, therefore, under the law of Pennsylvania, as declared by its highest judicial tribunal, the intention of the co.atracting parties is the standard by which the character of boilers, engines, and their appliances which may be placed upon the premises of another, is to be judged, it will not be necessary in the present case to pursue the inquiry as to whether or not a mortgage of the premises will cover after-acquired property; for we have only to discover .what was the intention of the parties to the contract of August 3, 1887, to ascertain whether the pumping engines manufactured by the Holly Company were to be considered as personalty or realty. In Vail v. Weaver, supra, the court emphasized its conclusion by saying, ''No. matter what the law formerly may have been," mere physical attachment with the realty is no longer a criterion of annexation, but the latter depends on the intention of the parties; citing Hill v. Sewald, supra; Seeger v. Pettit, 77 Pa. St. 437; Morris's Appeal, 88 Pa. St. 368. It is admitted by counsel for the appellants that, while the engines remained detached and separable from the real estate, the Holly Company was entitled to its lien, but it is claimed that when they were incorporated into the real estate the rights of the defendants, as mortgage creditors and bondholders, attached, and the lien was lost. If, however, this question is to be determined by the law of Pennsylvanil:l.; as a,nnounced in the cases just cited, then the intention of the parties to the contract of August 3, 1887, must prevail. What the mtention is to be gathered from the terms of the contract, parties to it could .not have used plainer language than they did to express their "Q.Dderstanding of the conditions.on which the engines w;ere to be made and placed in position, namely: "It is expressly ,upd:erstood and agreed that the party of the second part (the Holly Company) shall have a lien on all of said engines· and connectiolls, and. the party of the second part may remain in and have full possession thereof until the whole amount of the purchase price of said engines and connections shall have been fully paid to the party of the second Pllrt or its assigns." The parties did not intend an absolute sale of the property. The sale was not to be perfected until the property had been paid for, and to secure the payment of the price the vendor was to retain possession until this condition had been complied with. Retention of possession under such circumstances is inconsistent with an absolute sale. Hineman v. Matthews, 138 Pa. St. 204, 20 Atl. Rep. 843. The words used by the contracting parties must be taken in their ordinary sense, and there is no rule of construction which admits of any other meaning being given to them than that the sale was made subject to the payment of the price agreed on; and this interpretation is confirmed by the action of the Holly Company in holding on to the possession of the engines, and. by the proof that there had been no delivery of the property to .Bullock & Co. or to the water company, or of acceptance by either of the latter. As to the. general rule of law, uncontrolled by local governing conditional sales, the opinion of the supreme court of the United States, in Harkness v. Russell, 118 U. 8. 663, 7 Sup. Ct
,:
Flm1llRAt: REPORTER I vol. ai,'
53.
'aborate, .',s,cns" on, ,Of, the Who,Ie ·"With ,a, -f, trll, ,and in the courts of our andthe'JleClsion ofthec0titt was that, both on pririeiple :p;uthority, a con,ditiqual sale of' Personal even delivery, is ivall<l,bothas against the, parties and third persons;'" the court' ,s1Jated' the general rUle, as estabijsliedby' overw:I1ehmilg aullioritYr'to' be "that, in the absence of:fi'aud,a conditional sale is good and 'vaUdas well against thirdper'Sbns the' parties to the tranSl¢tion." , Theptesent'dase does nQtfaU within the ,elMS of cases cited by, appellitnt!J' (\Ol1nsel, in which it has beenheJ.d' that the rails and bridges ,of, of necessity, become P,'el'ID.a,nent. part of the whole strncture, ,and therefore' cannot 'be made'the subjects of spe· cW but is more to the class ,in which the rolling 'Stock of a railroad company has been held, to be the subject of a a lien may be reservfld by the vendor. conditional sale, and on And this appea.rs to be,rooson!:l,ble., Locomotive engines and cars iLre as essential to the operation of a railroad' as pumping engintls are to waterworks, but, it has, ,been held that the former may be treated as personal propeJ.'tY, and as such may be liable, to a lien in favor of the which' wi)]: not be lost in consequence of a prior mortgage wblch, by its ,tei'txlj, was made to cover after-acquired property. U;S. v. & O. It Co., 12 Wall. 362. See, also, Gregory v.Morris, 96 U.S,619; Harlan v. m.rlan, 20 Pa. St. 303; :Benedict v. Marsh, :1-27 Pa. St., 309, 18 Atl. Rep., 26; Haak v. Linder· man, 64 Pa: St. 499; Kratise'v., Com., 93 Pa. St.. 421; Peek v. Heirn, 127 Pa.I3t.500,17 Atl. Rep. 9&1:; Summersonv. Hicks, St. 566, 19 At!. 808; :r.evatrv. Wilten, 135 Pa. St. 61, 19 Atl. Rep. 945; Hinemailv.Matthews, 138Pa.St. 204, 20 At!. Rep. 843. As between 'the partieS, to the' contract, there can be no question of the validitY of the lien, or of the right of the Holly Company to enf9rce it, against Bullock & Co.; and it must not be overlooked that Bullock & 'Co., at the, date of the contract, were substantially the owners of the whole capital stock of the New Chester Water Company, and that, Samuel R. Bullock held the legal title to the real estate on,' which the pumping engines were erected, and did not convey it to the water company until long after this suit had been . instituted. . It has not ,been deemed. necessary to consider the question of the invalidity of the bonds, issued by the water companies, on the ground that the companies had no poweJ' to issue these obligations because of the failure to comply With the requirements of the Pennsylvania statute which authorizes the, issue of bonds by stock corporations to an amount proportioned to the value of their paid up shares. The facts found by the circuit court,and confirmed by an examination 'of the evidence, are sufficiently conclusive to establish the creation of the lien of the Holly Company, and to satisfy' us that this lien was not lost or waived by any act of that company, and that no one of the appellants had acquired a superior equitable' right to the property in dispute. The decree of the circuit court is therefore affirmed. 51,;, ' CP,',ntit", '"
WATSON
81
WATSO:N y. STEVENS etaI. (Circuit CoVrt of Appel\ls, First Circuit. October 29, 1892.) BILL OF REVIEW-AppEAL-MANDATE.
After the decision of. an appeal it was. made to appear by suggestion of counsel in open court. and by a verified petition supported by affidavits. that counsel for'tile defeated party. conceived himself entitled to make application for leave to, file a bill of review. Held, that the circuit court of appeals would not itself determine the right of such party to file the bill, but would, in ita mandate"resene.to him liberty to file an application therefor in the circuit court. and to proceed thereon and on the bill of review, aa the circuit court might determine.'.
from 1;Jle. Circuit Court of the United States for the District of 'Massachusetts. ;InEquity. Bill by .Jllremiah M. Watson against GeorgeH. Stevens and othera fQrinfringement of letters patent No. 367,484, issued August 2, 1887, to the complainant,for the "method of" and apparatvs for compressing shank Thecircu:\tcourt held that the alleged inve)ltion consisted only of the mechanical adaptatiolJ. of.ljIrell-knpwn machines anll processes toa new use, and dismissed the bill., 4'l'.Flld. Rep. 1,17. The complainant appealed tQ tb,ia court, which, on Se.p,tember 6,1892. rendered the following decision, (see 51'Fed; Rep. 757:) Thede<;ree of tbe circuit courtis reversed. The first, and sixth claims of complainant's'Pl\tent are 8ustainedfor use in producing shank stiffeners fromlea\her board; and the case is remanded to the circuit court, with instructions to enter a decree fOr complainant for an accounting, and for a perpetual injunction against making, vending, or usinft' for producing shank stiffeners from leather board, any machine or method IDfringing the first or sixth claims; and for other proceedings in conformity with this opinion; the complainant to recover his costs in this and the circuit court. " Thereafter, on September 28, 1892, the appellees (defendants below) filed in the circuitcourtof appeals a petition supported by affidavits alleging that, since tbe pUblication Of the opinion on the merits of the appeal, they had discovered the existence and use of two machines for more than two years prior to the applica· tion for the patent, which machines were an anticipation of the alleged invention. The machines were described in full, and the petition alleged that their existence and use. we,r,e well known to complainant before applying for his patent. The relief prayed was: "(1) That this case be reopened for the of introducing the newly-discovered evidence herein referred to. (2) That this,fase be remanded to the circuit court, with instructions that the case be reopened for the purpose of introducing the newly-discovered evidence herein referred to. (3) That the decree in this case shall be without injunction, or that injunction proceedings shall be suspended until such time as your petitioners shall have an opportunity, when the case is remanded.to the circuit court for further proceedings. to move in that court for the reopening of the case for the introduction of the neWly-discovered evidence herein referrell to; and, in case said motion is granted by said circuit court, that the injunction proceedings sball l)e suspended, pending the final determination of the cause on the new evidence. (4) That th'e decree in this case shall not beeqtered or recorded, and that all proceedings therein shall be stayed pending the COnsideration of this petition. (5) Your petitioners pray for such other or further relief in the premises a.s to tbis court may seem meet, and as is req\lired by the principles of equity and good conscience." The 8PJllillant thereafter filed 8 motion to strike this petition and its accompanying' affidavits from the files, which motion was heard before Colt and Putnam. cirC1;lit judges, and Aldrich. district judge. At this hearing the court suggested that under the decision in Southard v. Russell. 16 How. 547.571, permission ahould be obtained by application to the circuit court of appeals to file a bill of review or supplemental bill in the nature thereof, and thereupon couDsel were granted leave to file briefs on the question of the appropriate procedure.
Frederick P. Fish and W. K. Richardson, for appellant. At the ;hearing it was suggested by the court that under the decision in Southard v. Russ,eU, 16 How. 047,571, permission to file a bill of review or a supple