ABSTRACTS OF RECENT DECISION. SUPREME COURT OF THE UNITED STATES

October Term, 1880.

IMPORT DUTIES-PAINTINGS ON PORCELAINDECORATED CHINA.-This was a suit to recover back duties paid under protest. The bill of exceptions stated it was proven at the trial, that all the goods charged with the duties were "pictures painted by hand, and their value depended on the skill of the particular artist who painted them, and the porcelain ground on which they were painted was only used to obtain a good surface on which to paint, and was entirely obscured from view when framed or set in any manner, and formed no material part of the value of said painting on porcelain, and did not in itself con-stitute an article of chinaware, being manufactured simply as a ground for the painting, and not for any use independent of the paintings." The collector exacted a duty of fifty per centum ad valorem under the clause in schedule B, sec. 2.504, Revised Statutes, relating to "china, porcelain and parian ware, gilded, ornamented or decorated in any manner," while the importer claims they were dutiable at ten per centum ad valorem only, under the clause in schedule M, which embraces "paintings and statuary not otherwise provided for." In other words, the collector claimed they were decorated china or porcelain ware, and the importer that they were paintings on china or porcelain. The evidence seems to have left no doubt on this subject, for it is expressly stated in the bill of exceptions to have been proved that the porcelain ground on which the painting was done -"did not in itself constitute an article of chinaware." Such being the case, the painting which was done on it did not make it decorated chinaware. Confessedly the goods were paintings done by hand, and as it is not claimed they were "oth⚫erwise provided for" than as chinaware decorated, it follows the court was right in directing a verdict in favor of the importer for the difference between ten and fifty per eent. It is a matter of no importance in this case, that the colors used were metallic, and that the pictures were baked to make the colors more firm. If the jury had found a verdict in favor of the defendant, the court should have set it aside as against what is admitted to have been proved. Under such circumstances a judgment will not be reversed on account of a positive instruction to find for the plaintiff : Pleasants v. Fant, 22 Wall. 416. As the bill of exceptions states that the facts on which the case depends were proved, we can not say that the admission in evidence of samples of "similar” importations on which duties had been paid at ten per centum could have prejudiced the collector's case. The question which the court decided was, that the goods were not chinaware, but paintings. Affirmed. In error to the Circuit Court of the United States for the Southern District of New

York. Opinion by Mr. Chief Justice WAITE.Arthur v. Jacoby.

ASSIGNEE IN BANKRUPTCY-RIGHTS AS ΤΟ PAPER DUE THE BANKRUPTS HELD AS COLLATERAL. The facts of this case briefly stated are these: In 1876, the firm of Brunswick Brothers, Stephani & Hart Company was engaged in the business of making and selling billiard tables at Chicago and St. Louis. In August or September of that year this firm agreed to sell the J. M. Brunswick & Balke Company, the stock and branch of the business at St. Louis, for which the purchasing company was to give, when the stock was transferred, its notes of $1,000, each payable three months from date, and the balance of the invoice when taken was to be divided into monthly notes of $1,000 each, the first to fall due four months from date, and one each month thereafter until the whole price was paid. The three notes due three months after date were to be delivered to the selling firm when the transfer of the stock was made, but the others were to be deposited with the International Bank of Chicago, with instructions that they be delivered one month before their maturity. The invoice when taken amounted to $12,000. The stock was transferred and notes executed according to the agreement, September 9, 1876. The three first to fall due were at once handed over to the selling firm, and the others deposited in bank as agreed.* The firm of Brunswick Brothers, Stephani & Hart Company was dissolved in September, 1876, and all its assets passed on the dissolution to the firm of Brunswick, Stephani & Hart, which was its successor in the business. On the 16th of September the new firm agreed that the bank might hold the nine notes then in its possession as collateral security for the indebtedness of the firm to the bank, which then existed, or which might thereafter be created. The firm was at the time owing the full amount of the notes, a part, at least, of which was for a debt incurred under a promise to give the notes as collateral when they were obtained. Proceedings in bankruptcy were instituted against Brunswick, Stephani & Hart, on the 29th of November, 1876, and they were adjudicated bankrupts on the 16th of the following December. On the 3d of February, 1877, the other members of the firm of the Brunswick Brothers, Stephani & Hart Company, filed their petition in bankruptcy, and on the same day they were adjudicated bankrupts and made parties to the former proceeding. The J. M. Brunswick & Balke Company paid the notes to the bank as they fell due, and the payments as made were applied to the liquidation of the debt for which they were held as collateral. On the 25th of June, 1877, the assignee in bankruptcy of the bankrupt firms commenced this suit in trover against the bank to recover damages for the unlawful conversion of the notes and the moneys collected thereon. This statement, which is not disputed, shows clearly, as we think, that the court below committed no error in directing a verdict in favor of the bank.

The makers of the notes do not complain of what was done between the bank and the payees. They owed the debt represented by the notes, and have paid it to the bank as it fell due. As the payments were made, they got up their notes. The rights of the assignee against the bank are only such as the bankrupts themselves had when the proceedings in bankruptcy were commenced. That the St. Louis firm owed the debt to the Chicago firm, whether the notes were ever delivered by the bank, or not, under the terms of the deposit, is conceded. That debt was assigned to the bank as collateral. Such is the legal effect of the agreement between the bank and the firm. That gave the bank the right to collect the notes as they fell due, and apply the proceeds to the discharge of the debt, to secure which the transfer was made. This was done more than two months before the proceedings in bankruptcy were begun, and there is no allegation or suspicion of bad faith. This made the title of the bank good as against the creditors of the bankrupts. Certainly, the bankrupts can not call on the bank to return the notes until the debt for which the security was given is paid. No more can the assignee. Affirmed. In error to the Circuit Court of the United States for the Northern District of Illinois. Opinion by Mr. Chief Justice WAITE. Bacon v. International Bank of Chicago.

WILL-PARTNERSHIP― CONTINUANCE AFTER DEATH-LIABILITY FOR PARTNERSHIP DEBTS. -W. H. Walker, a large dealer in liquors, in partnership with his son Frederick, made his will in which he provided that the liquor business should be carried on by his son Frederick under the old firm name, until his youngest child living should arrive at the age of twenty-one years; that his capital and interest in the concern should be continued therein, and should be chargeable for its debts and liabilities, but that his other property should not be so chargeable; that the profits of his interest in the concern should annually be divided among his wife and children. The testator died in 1872, and the business was conducted as directed in the will until February 27, 1877, when the firm, on the petition of its members, was declared bankrupt in the proper court. The appellant Jones was made assignee, and very shortly afterwards filed the bill in the present case in the Circuit Court of the United States for the District of Kentucky against the devisees of W. H, Walker's will. The object of the bill is two-fold, namely, to subject the property of the deceased, which had not been embarked in the partnership enterprise, in the hands of the devisees, to the payment of the partnership debts, and to recover from the defendants money which they had received as dividends out of the profits of the business after the death of the testator. In the recent case of Smith v. Ayres, 101 U.S., 320, the legal principle lying at the foundation of the first of these grounds of relief was fully discussed and determined. It was there held that a testator might authorize the continuance of a

partnership, in which he was engaged at the time of his death, without subjecting any more of his property to the vicissitudes of the business than what was then embarked in it, and that, unless he had expressly placed the whole, or some other part of his estate, under the operation of the partnership, it would not be presumed that he had so intended. See, also, Burwell v. Mandeville's Executors, 2 How., and Ex parte Garland. 10 Vesey, jr., 109. In the case before us the testator declares, in express terms, that "his capital and interest in said concern shall be continued therein, and shall be chargeable for its debts and liabilities; but his other property shall not be so chargeable." There is no reason in this case for departing from the principles of Smith v. Ayres, supra. The dividends were made in pursuance of the will of the testator and family, and honestly made, and when paid did not diminish the capital of the concern. It very fully appears that the insolvency was brought on by accommodation indorsements for others made after the last dividend was paid; that the firm, but for this, would have remained solvent, and that in regard to this none of the defendants were to blame, except Frederick, who being a full partner is liable personally for all the debts of the firm. Moreover, it appears from a stipulation of the parties that none of the debts of the firm were in existence at the time these profits were declared and paid. No creditor whose debt was in existence when these dividends were made was injured. Affirmed. Appeal from the Circuit Court of the United States for the District of Kentucky. Opinion by Mr. Justice MILLER.-Jones v. Walker.

SUPREME COURT OF INDIANA.

May, 1881,

PARTNERSHIP-RIGHTS AND LIABILITIES OF PARTNERS INTER SESE.-When an account is to be taken in a partnership, each partner is entitled to be allowed against the other everything he has advanced, or brought in as a partnership transaction, and to charge the other in the account with what the other has not brought in, or has taken out more than he ought, and nothing is to be considered his share but the proportion of the residue on the balance of the account. This proportion of the residue, to which each party is entitled upon final settlement, is obviously what remains to him after all his obligations to the firm, and to the other members thereof, respectively arising out of contract. or articles of partnership, have been fully discharged. Each partner has a specific lien on the parnership stock for moneys advanced by him more than his share for the use of the partnership, and the lien of each partner exists not only as against the other partners, but also against all persons claiming through them or any of them. 1 Lindley onPartnership, 681. Where part

ners are in the joint possession of the partnership property in the prosecution of their business as partners, the individual creditors are required to take notice of their respective rights and interests in such partnership property, and of the prior claim which any other person, interested in the business of the partnership, might have against such property. No record of the articles of partnership is necessary to charge individual creditors with notice of such rights and interests and of such superior claims. Where a partner gives a mortgage upon his interest in partnership property, to secure his individual indebtedness, the mortgagee is necessarily put upon his inquiry as to the tenure by which such partner holds an interest in the mortgaged property, and is charged with notice of any prior claim which the other partners may have upon it. Affirmed. Opinion by NIBLACK, J.-Lewis v. Harrison.

LAW MERCHANT-NOTE GIVEN FOR A PRECEDENT DEBT-EXTINGUISHMENT.-A promissory note not payable at a bank in this State, and not governed by the law merchant, such as the note sued on in this case, though given for a precedent debt, will not operate as a payment or in extinguishment of the precedent debt in the absence of an express agreement by and between the parties. 58 Ind, 221; 64 Ind. 406. In this case there was no express agreement that the note sued on should operate as a payment of the former note as claimed by appellant. When the payee of a note induces parties to become sureties on the note by an agreement to do certain things, which he afterwards fails and refuses to perform, there is a failure of consideration of the note as between the payee and the sureties. 30 Ind. 22; 33 Ind. 289. Affirmed. Opinion by Howк, C. J.-Jeffries v. Lamb.

DEATH BY WRONGFUL ACT-MEASURE OF DAMAGES FOR KILLING A CHILD.-Action by appellee against appellant for damages for the killing of his child, five years of age. In an action by a parent for the death of his child, he is entitled to recover only for the pecuniary injury he has sustained, and the proper measure for damages is the value of the child's service from the time of the injury until he would have attained his majority, taken in connection with his prospects in life, less his support and maintenance. To this may be added, in proper cases, the expense of care and attention to the child made necessary by the injury, funeral expenses and medical services. Thompson on Neg., vol. 2, 1292; Redfield on Neg., sec. 608. To enable the parent, however, to recover full damages for the services of the child during minority, such damages must be especially declared for and demanded. 1 E. D. Smith, 453. In this case the jury granted a verdict of $1,800. This was excessive in view of the fact that there was no evidence tending to show loss of service, and that the complaint did not constitute a demand for the loss of future services of the child. Reversed.

Opinion by NIBLACK, J.-Pennsylvania Company v. Lilly.

RECENT LEGAL LITERATURE.

Com

DILLON'S MUNICIPAL CORPORATIONS. mentaries on the Law of Municipal Corporations, by John F. Dillon, LL.D., Professor of Real Estate and Equity Jurisprudence in Columbia College Law School; Late Circuit Judge of the United States for the Eighth Judicial Circuit, and formerly Chief Justice of the Supreme Court of Iowa. Third edition, revised and enlarged. 2 volumes. Boston, 1881: Little. Brown & Co.

The general scope and excellence of this work, and the reputation of the author, and the peculiar reasons for his capacity to speak authoritatively upon this branch of the law are so well known to the whole country as to render it unnecessary for us to enter into any extended discusssion of the merits of the plan of the work and its execution. Its position in the legal literature of the country, has been long since fully established and acknowledged. Of this, the third edition, Judge Dillon says, in the preface, "The reported decisions to December 1, 1880, have all been diligently examined, and the results of such an examination wrought into the texture of the present edition. This has necessarily increased its size, and cor-respondingly, it is hoped, its value. More than 200 new sections have been written, and over 3,000 additional cases cited. Every part has been gone over with conscientious care, and there is scarcely a section in which, either in the text or the notes, additions and changes have not been made."

NOTES.

-The June number of the North American · 'Review is an unusually interesting one. The articles entitled respectively, "Our Future Fiscal Policy," "The Patrician Element in American Society," and "Shall Americans own Ships?" all deserve a careful reading. Persons interested in archæology will enjoy reading "The Ruins of Central America," the eighth instalment of an excellent series of articles upon that subject, and "Prehistorie Man in America," by Prof. Edward S. Morse, in which a fascinating subject is treated in a most attractive manner. "A New Phase of the Reform Movement," and "Vaccination" are successful discussions of live questions of the day. "The Color Line," by Frederick Douglass, is of value as being a statement of real or supposed race grievances by one of the aggrieved. The article of particular interest to the legal profession.. however, is a paper entitled "The Right to Regulate Railway Charges," by J. M. Mason, in which a much discussed legal question is put in such a way as to be of interest, and intelligible to the general reader.

in excess of compensation for the injuries set forth in his complaint, and sustained by his testimony. As Sir Lucius O'Trigger might say: "It is a very pretty quarrel as it stands" -and we do not intend to meddle with it. We are warned by the example of Mr. Justice Foster, of New Hampshire, who, after an exhaustive discussion of this subject in Fay v. Parker, says: "We may venture no further in this direction. It were better if we had recognized the 'characters in color dim' inscribed upon the portal of our entrance." The learned judge likens the controversy to that very undesirable place, at the entrance of which all hope must be left behind; but as the similitude is couched in the "choice Italian" of Dante, it is less shocking to the sensibilities than if bluntly expressed in the vernacular.

To a great extent, the discussion has been prolonged and intensified by misunderstanding and misuse of words and technical terms, and illustrates the importance of distinct and accepted definitions in all controversy. The views of Mr. Sedgwick have, however, been adopted in most of the States, and therefore, accepting as the law, the doctrine, that such damages beyond compensation are allowable, we will investigate the various circumstances and conditions under which they can be awarded. Such damages are denominated indifferently, vindictive, exemplary and puni tive, and each word expresses one of the objects which they are intended to effect; vindictive, they minister to the revenge of the plaintiff, avenge him on his adversary; exemplary, they are a warning to all others in like case offending; punitive, they are designed to punish the evil-doer. Of course, they include and exceed the most liberal estimate of compensatory damages, as otherwise they would be compensatory, and only indirectly, if at all, vindictive, exemplary, or punitive. There is however not a little confusion of language in the books on this subject; for all damages in excess of the strict, gross material loss in actual pecuniary value, suffered by the plaintiff, are often denominated exemplary, when in point of fact they are merely, and sometimes barely, compensation. Exemplary damages are awarded only in actions arising ex delicto, except in the single

2 53 N. H. 342, 375.

case of suits to recover damages for breach of marriage promise. There are some loose dicta, as well as several old cases indicating that under extreme circumstances, damages of this character may be awarded in other actions arising ex contractu3; but the better opinion is that, with the exception above noted, exemplary damages can only be given in cases where the cause of action arises ex delicto.

The subject divides itself into injuries affecting the plaintiff, in his domestic relations; in his person; in his reputation; in his estate; and in his personal liberty. We propose to consider how far infringements of his rights in each of these relations are visited by the law with exemplary damages. First, then. in breach of marriage promise it is well settled, that from the nature of the case the measure of damage is a question of discretion for the jury in each particular instance.* It must not, however, be inferred that because the law fails to limit the powers of the jury in such cases, the damages they award are necessarily punitive; on the contrary, a jury, by a very thorough exercise of the ample powers with which in this class of cases they are clothed, may fail to exceed the boundaries of compensation. In proper cases they can, and do award exemplary damages to an extent that is practically without limit. Courts will rarely, or never, set aside their verdicts for excessive damages, nor indeed for any other reason, unless they are influenced by prejudice, passion or corruption. In Goodall v. Thurman," the court says: "We do not feel authorized to grant a new trial in this case upon the single ground of excessive damages, although we consider the amount entirely disproportionate to the case made out in the proof." In this case and in that of Collins v. Mack,6 which follows and approves it, seduction was superadded to the breach of promise of marriage; and in neither case, except for the distum of

* Rose v. Beatie, 2 Nott & McC. 538; Nurse V. Barns, Th. Raymd. 77.

4 Southard v. Rexford, 6 Cow. 254: Smith v. Woodfine, 1 C. B. (N. S.) 660; Berry v. Da Costa, 12 Jurist (N. S.) 588; Coryell v. Colbaugh, Coxe, (N. J.) 77; Dinslow v. Van Horn, 16 Ia. 476; Tobin v. Shaw, 45 Me. 331; Wells v. Padgett, 8 Barb. 323; Thorn v. Knapp, 42 N. Y. 474; Wilbur v. Johnson, 58 Mo. 600; Collins v. Mack, 31 Ark. 684.

1 Head (Tenn.), 209.

6 31 Ark. 684.