SEYMOUR D. THOMPSON,

Editor.

}

ST. LOUIS, FRIDAY, JULY 16, 1875.

BANKRUPTCY-LANDLORD'S LIEN FOR RENT.-The question of the right of a landlord to priority of payment of rent over the general creditors of a bankrupt, which was passed upon by Mr. Circuit Judge Woods, in Re Schulman, Frankfurter & Co., ante, p. 42, has again been up for adjudication, this time before Mr. Justice Bradley, in the case of Austin v. O'Reilly, which we elsewhere print. It will be seen that he resolves the question in favor of the right of the landlord to be preferred, although no attachment has been issued for the rent, in pursuance of a law of the state, which gives that remedy instead of a distress.

THE VETO POWER OF THE GOVERNORS OF THE TERRITORIES.—A correspondent writing from Tucson, Arizona Territory, tells us that there is a subject which is likely to arise in Arizona, and which may cause much trouble. Congress has passed an act giving the governors of the territories of Arizona and Utah, an absolute veto over the legislatures of those territories. The correspondent also states that at the last meeting of the legislature of Arizona, several of the most important measures were allowed by the governor to die, after having passed that body, for the lack of his signature. The governor recommended in his message the necessity of making the office of the probate judge elective throughout the territory. The legislature, following his suggestion, passed an act to this effect. This the governor vetoed. The act was then passed by an almost unanimous vote of both houses over his veto, but under the act of Congress above mentioned, this was to no purpose. Thus the legislature of that territory finds itself entirely at the mercy of the governor, no matter who he may be. Our correspondent enquires, "Is the act of Congress constitutional, which clothes the governor with an absolute veto over the legislature ?"

Hon. JOHN F. DILLON,
Contributing Editor.

Penal Law-The Brighton Aquarium Case. The Brighton Aquarium case, so-called, has attracted considerable attention, both in England and in this country. It seems that in Brighton, England, is a museum designed chiefly to illustrate the wonders of aquatic life. Connected therewith is a reading room. The institution has been kept open to the public on Sundays, and the ungodly evolutions of the watery animals were accompanied by the diabolical adjunct of music. Now there is an old statute which most Englishmen had forgotton, giving a penalty to any one who should sue therefor in case of places of public amusement being kept open on Sunday. But there was a zealous Sabbatarian named Terry, moved either by fanaticism or greed, or, perhaps, by a mingling of the two, who did know of the existence of this statute, and he brought suit upon it, and the cause was tried in the court of Queen's Bench, and the judges, greatly to their disgust were obliged to enforce it; and, what is worse, it seems that the government has no power to remit the penalties in this case—a power which has been given in some other instances by statute.

This case has led to a discussion in the Law Times as to

the state of the law of England with reference to penal actions, from which it would seem that in some cases the informer can not sue without the consent of the attorney-general.

On the subject of qui tam actions, we have in mind a matter from which the advocates of temperance legislation might take a hint. We recently had before us the manuscript of an exceedingly caustic satire written in the interest of such legislation by a citizen of Indiana. In this it was stated that at an early day the legislature of Indiana so far yielded to the clamors of the temperance people as to pass a law giving a penalty of five dollars to any one who should sue therefor, who had been furnished a drink of liquor by a retail liquor dealer, together with five dollars costs to the justice before whom the suit should be brought. It was regarded as a joke at the time, so no one dreamed that any considerable number would be found so dishonorable as to bring such actions. But it was not so. As soon as liquor sellers began to press their delinquent customers to settle up their scores, or refused to lend money to others, they began to be annoyed by these actions. What was more, the cracksmen and pickpockets soon quit their regular

We think the act hard and oppressive in the case of Arizona, unless there is something in the preponderance of the Mexican element in the voting population, which may possibly furnish some excuse for it. The measure in question will be laid at the door of its authors, as a serious violation of the principles of American representative government, and they will be unable to justify themselves without showing something very anomalous in the condition of things in that territory. But whilst this is so, we have no doubt what-professions and began to frequent drinking saloons and to ever of the power of Congress to pass such a measure, or to govern a territory through a governor without any legislature at all, or even by a military commandant, as in the case of Alaska, if it shall see fit. The only provision in the constitution bearing on the subject which we remember, recites that "the Congress shall have power to dispose of, and make all needful rules and regulations respecting the territory or other property belonging to the United States." Art. 4, § 2. No grant of power could be more absolute or unqualified. But even if the act of Congress, to which our correspondent alludes, were in derogation of the constitution, yet it is a political act purely, and, under repeated decisions of the Supreme court of the United States, can not be called in question by the judiciary.

bring these suits. The raid was so great, the writer tells us, that it must have resulted in an entire suspension of the noble avocation of the dramseller in Indiana, had not the legislature at an extra session hastened to repeal the law. The writer argued from this instance that no law of a reformatory character can be enforced, unless individuals are made pecuniarily interested in its enforcement.

Immaterial Warranties in Life Insurance. This subject received considerable attention in the late opinion of the Court of Appeals of New York, in Fitch v. American Popular Life Ins. Co., reported 11 Alb. Law Journal, 91. The point arose under the enquiry in the application, if the assured "had ever had any illness, local dis

ease or injury in any organ," which he answered in the neg-shocking to the moral and common sense of the community, ative. It appeared in evidence that some years before death that plain men get a bad idea of law, of courts, and of the the insured had had a temporary inflamation of the eyes, administration of justice." caused by some sand having been thrown in his eyes during the late war, but of which he had long before been cured, and that it was not calculated to affect the duration of his life.

The policy and the application had, in the customary form, provided that the answers of the insured, to the questions in the application, were warranties on his part; and the insurer defended on the ground (among others) that in respect of the disease above-named, there was a breach of a warranty. In considering this defence, the court referred particularly to some unusual clauses in the explanation at the head of the application, to the effect that the policies of that company were made in "entire, unconditional, honest, good faith," and that like good faith on the part of the applicant was required; and that "the assurance can be jeopardized only by dishonesty or inexcusable carelessness on the part of the applicant." Reference was also made to a notice annexed to the policy, stating that "payment will be contested only in case of fraud.”

The court, Rapallo, J., first stated the doctrine in all its strictness, of the avoidance of a contract by the breach of an immaterial warranty, in this language:

"Where a warranty is understandingly and clearly given by an insured, no matter how immaterial the fact warranted may be, he will be held strictly to his contract."

The disputed doctrine is then traced from some supposed dictum of an ancient "big-wigged judge" that "the breach of an immaterial warranty avoids a contract," through succeeding dicta of other big-wigs, until finally, "three dicta make the law." "This," it is suggested, "is a very convenient way, because it saves modern judges the trouble of thinking and the responsibilities of deciding, and gives them the appearance of learning." The editorial conclusion drawn from the Fitch case is, that "owing to the impunity with which life insurers are permitted to set traps for the ignorant and unwary in their policies, and the rigor and bigotry with which our courts construe these contracts, the community are rapidly losing faith in life insurance."

These criticisms are referred to not for the purpose of dissent or discussion as to their justness, but in connection with them, to call attention to the recent opinion of the Supreme Court of the United States, in the case of Jeffries v. Economical Mutual Life Ins. Co., delivered by Mr. JusticeHunt, April 5, 1875, and reported in 2 CENT. LAW JOUR. 344.

In this case it was a condition of the policy that the statements and declarations made in the application were "in all respects true and without the suppression of any fact relating to the health or circumstances of the insured, affecting the interests of said company; and it was agreed that if

But immediately following this dictum, the learned court this condition were violated, the policy should become null laid down the law of the case as follows:

"But when thrown off his guard and induced to enter into such a contract, by declarations of the insured, such as appear in this case to have been contained in the papers prepared by the defendant and evidencing the contract, the declaration in the same papers that the statements are warranties, and the basis of the contract, etc., must be so construed, if possible, as to harmonize with the explanations and declarations of the insurer, and if this is not possible, they should be rejected."

and void. It was further declared in the policy that it was made and accepted upon the express condition and agreement that the statements and declarations of the application were in all respects true. The learned court met fairly and squarely the criticisms above mentioned as to immaterial warranties, by holding that, by the stipulation last named, it was agreed that if those statements were not all true, no policy had been made.

The statements controverted were, first, that the insured was a single man, and second, that he had not applied for inIt was thereupon held that the evidence above referred to surance to any other company; whereas, as the defendant was not "conclusive evidence of fraud, or a breach of war-pleaded, the insured was a married man, having a wife then ranty sufficient to avoid the policy. If of any importance, known to be living, and had applied for and secured $10,000 it was, at most, evidence of fraud to be submitted to the insurance in another company. This plea being demurred jury." to, on the ground that it did not aver the false statements to be material to the risk, the demurrer was overruled in the circuit court, which ruling is sustained by the appellate court.

In a subsequent issue (Feb. 30, 1875), the able and earnest editor of the Albany Law Journal, at p. 120, comments with severity upon the adhesion of the New York court to the doctrine of immaterial warranties, in language as follows, after quoting from the opinion the recital of a number of apparently immaterial questions, such as crowd the pages of applications for life policies:

It will be observed that while the materiality of the untruth as to other insurance is clear, from the two considerations, that excessive insurance often tends to defraud the insurer, and that a rejection of the applicant by another insurer ought "And yet they hold that if an insurer inserts these ques- not to be concealed, it is not so clear that the untrue statetions and provides that the answers shall be warranties, and ment as to applicant's marriage was material. But both the man who undertakes to answer them makes an inadvert- these points are ruled against the insured. Though the deent mistake that does no harm, nay, that is less favorable to ceit as to the marriage might be to the benefit of the insurer, himself than the strict truth demands, and thus operates to it is still held fatal to the policy. Such an argument on this the benefit of the insurer, he has lost the benefit of his con-point as that quoted from the Alb. Law Journal, supra, the tract, and that, too, although the insured may not have been learned court holds to be "bad morality and bad law." deceived in the least, but may have known the truth all the "No one," it says, may do evil that good may come! No time, and, with this knowledge, have gone on for half a cen- man is justified in the utterance of a falsehood. It is an equal tury taking premiums from its innocent victim. This is so offense in morals, whether committed for his own benefit or

persons procuring policies see fit to take such contracts, and make such statements as the basis thereof, they must abide the consequences." But the opinion in the Jeffries' case, delivered by Mr. Justice Hunt, who has occupied a seat on the bench of the New York court of Appeals, and may be sup

that of another." And because the contract made by the parties was found thus positive and uncompromising, the court declined to submit the question of the materiality of either untruth to a jury. The learned judge apparently attached some importance to the question of the applicant's marriage, in view of the supposed fact that a married man, who is over-posed to reflect the views of New York jurists on this quesinsured, may commit suicide for the benefit of his family. But all this is purely suppositious, and is suggested as evidencing, not any fact of the case at bar, but only a possible peril to guard against, which was so much in the mind of one of the contracting parties that the contract was made in reference thereto. The learned judge concedes that "the information received may be immaterial." So that as to the question of the applicant's marriage, a fair case is presented of an "immaterial warranty." But by this court, of last resort, it is expressly held that "if under any circumstances it can produce a reply which will influence the action of the company, the question can not be deemed immaterial."

tion, is pointed and incisive. Though pronounced afterward, its conclusions would furnish a good text for the criticism of the Albany Journal. Whether they justify it, is not the question we present. It is of principal importance to those engaged in studying this branch of the law, to enquire, why this great difference between that large class of whom it is understood the Albany critic is a representative, and so able and justly respected courts as the United States Supreme Court and the New York Court of Appeals? These and other tribunals rest their decision of this question, on the right of the individual to make an unwise bargain if he chooses. How comes there to be so great a divergence of views on this subject, that it is said in behalf of the dissenters from that conclusion, that it is "so shocking to the moral sense" as to give plain men "a bad idea of law and of courts," and to cause the community to lose faith in life insurance? When so different conclusions are reached on the same subject, by reasoning people, supposed each to be impartial, it is evident that some one is painfully in error. We fear the logicians may discover that one class or the other has been reasoning from incorrect premises.

With the apparent intention of instructing applicants for life insurance as to the law governing their contracts, the court used the following language, which is here quoted as a plain assumption of an advanced position on the question at issue, and a clear statement of the reasons for assuming it: "The proposition at the foundation of this point is this, that the statements and declarations made in the policy shall be true. This stipulation is not expressed to be made as to important or material statements only, or those supposed to be material, but as to all statements. The statements need not come up to the degree of warranties. They need not be representations, even, if this term conveys an idea of an affirmation having any technical character. Statements and declarations is the expression-what the applicant states, and what the applicant declares. Nothing can be more simple. If he makes any statement in the application it must be true. If he makes any declaration in the application it must be A faithful performance of this agreement is made an express condition to the existence of a liability on the part of the company. There is no place for the argument, either that the false statement was not material to the risk, or that it was a positive advantage to the company to be deceived by it. It is the distinct agreement of the parties that the company shall not be deceived to its injury or to its benefit. The right of an individual or a corporation to make an unwise bargain, is as complete as that to make a wise bargain. The right to make contracts carries with it the right to determine what is prudent and wise, what is unwise and imprudent, and United States Circuit Court for the Southern District of upon that point the judgment of the individual is subject to that of no other tribunal."

The question arises in view of the foregoing quotations, what is the reason of the great difference between the conclusions of the Washington decision, and those of the Albany criticism? It may be observed that the Fitch case in the New York Court of Appeals, was rested on the ground of fraud on the part of the insurer, so that what was said as to immaterial warranties, was but a dictum. But in this the court stated what is probably its settled conviction on the subject, as evidenced by the later cases of Higbie v. Guardian Life Co., in the same court, cited 7 W. I. Rev. 217, and Baker v. Home Life Co., in the New York Supreme Court, cited 8 W. I. R. In the latter case it was said:

547.

"If

Among other late cases on this point, we find rulings similar to those of the Jeffries case, in Day v. Mutual Benefit Life Co. (Sup. Ct. D. C.), 3 Ins. Law Jour. 253; Fox v. Penn. Mut. Life Co. (Phila. Dist. Ct.), 3 do. do. 471; Holterhoff v. Mut. Ben. Life Co. (Cinc. Sup. Ct.), 3 do. do. 854; Conover v. Mass. Mut. Life Co. (U. S. Ct. Mo.), 8 W. I. Rev. 152, and Reid v. Piedmont & A. Life Co. (Sup. Ct. Mo.), 7 do. do. 399. Contra, are the cases of Southern Life Ins. Co. v. Booker (Sup. Ct. Tenn.), 7 W. I. Rev. 96, and Teutonia Life Co. v. Anna Beck (Sup. Ct. Ill., Jan., 1875), cited in 7 Chic. Leg. News, 190. The last case was decided against the insurer partly on the ground that there was no evidence showing that the insured had ever read the contract.

J. O. P.

Bankruptcy-Rent-How far a Lien.
AUSTIN v. O'REILLY, ASSIGNEE, ETC.

Mississippi, June 21, 1874.

Before Mr. Justice BRADLEY, of the Supreme Court.

In Mississippi, a landlord, where a tenant becomes a bankrupt before any attachment has been issued for rent, is entitled to priority of payment before the general creditor.

This was a contest between the landlord of the bankrupts, claiming priority, and the assignee. At the time of the adjudication the bankrupts were indebted to Austin, the landlord, in the sum of $1850, for a year's rent of the premises occupied by them in conducting their business, and had in their possession (on the demised premises) sufficient property liable to distress for rent, to satisfy the amount. An assignee being appointed, this rent was demanded of him before he removed the property, and payment refused, upon the view that the claim for rent stood upon the same footing as an ordinary debt against the estate. Sec. 852

Buck & Clark, for the landlord, cited: In re Appold, I Bank. Reg. 621; In re Rose, Lyon & Co., 3 Bank. Reg. 265; In re Wynne, 4 Bank. Reg. 5; In re Trim et al., 5 Bank. Reg. 23; Long-glish statutes, and by the statutes of most states, follow the propstreth v. Pennock, 20 Wall. 575, pro; and commented on Brock v. Terrell, 2 Bank. Reg. 190; In re Joslyn et al., 3 Bank. Reg. 118; In re Butler, 6 Bank. Reg. 501; and Marye v Dyche, 42 Miss., and Stamps v. Gillman, 43 Ib., contra.

the state of Mississippi, a landlord, whose tenant becomes a bankrupt before any attachment has been issued for rent, is entitled to priority of payment over the general creditors. This question must be decided in view of the provisions of the bankrupt law, and the peculiar rights of landlords, in reference to enforcing payment of rent in Mississippi. The bankrupt act (section 14) declares that the assignment shall relate back to the commencement of proceedings in bankruptcy, and that, by operation of law, the title to all property and estate, both real and personal, of the bankrupt, shall vest in the assignee, although attached on mesne process, and shall dissolve any such attachment made within four months next preceeding. The inchoate lien obtained by an attachment, and not perfected by judgment, is thus rendered null by the proceedings in bankruptcy. But perfected liens are pro-tachment for the purpose of effecting a distress for rent, but when In Mississippi, it is true, the landlord is obliged to sue out an at

more properly speaking, of a distress. He has the same right of proved.' That it does one or the other seems to be evident, priority over execution creditors, and the same right to prevent and yet which ever way we view it, we are led into serious diffithe removal of goods, and to follow goods clandestinely removed, culties. It is certain, however, as we think that under said secwhich exists in England and most of the other states. It is true tion any pleading may be amended by correcting any mistake that the supreme court of this state has held that the landlord's therein, or by inserting other allegations material to the case, when right is not a lien; and that a bona fide mortgage or sale by the such amendment does not change substantially the claim or detenant, will displace it. fence.

Code Practice-Amendments changing Cause of ger. The amended petition states that he was killed by the

THE KANSAS PACIFIC RAILWAY COMPANY v. MAR- and as to the proof under the original petition, the plaintiff had

With the view that we have taken of the question now under consideration, we do not think that it is necessary for us to deter-ried, differs widely from the contract under which an employe is carmine whether the phrase," when such amendment does not change substantially the claim or defence," applies to and qualifies all that precedes it, or whether it merely applies to, and qualifies the words, or conform the pleading or proceedings to the facts *This is the official syllabus, prepared by Valentine, J., the other justices concurring. Ed. C. L. J.