And when a con

Again, the failure of Owen, the individual, to promote the company, is no defense to the suit by the corporation and Owen, the trustee, for the specific performance of the entire contract by Howe, because the covenant promote, if it exists, is an individual covenant of Owen which does not go to the whole consideration of the contract, but is subordinate and incidental to, and relates to, less than one-tenth of it. A breach of a covenant which does not go to the whole consideration of the contract, but is subordinate and incidental to its main purpose, does not constitute a breach of the entire contract, does not authorize the injured party to rescind the agreement, but he is still bound to perform his part of it, and his only remedy is a recovery of damages for the breach. Kauffman v. Raeder, 47 C. C. A. 278, 286, 108 Fed. 171, 179, 54 L. R. A. 247. tract has been partially executed, and one of the parties has derived substantial benefits, or has imposed upon the other material losses through the latter's partial performance of the agreement, then the first party cannot rescind the contract on account of the failure of the second party to complete his performance; but the agreement must stand, the first party must perform his part of it, and his only remedy for the failure of the second party to completely perform is compensation in damages for the breach. Kauffman v. Raeder, 47 C. C. A. 278, 284, 108 Fed. 171, 177, 54 L. R. A. 247, and cases there cited. Howe has derived the benefit of a conveyance by Elmo C. Owen of one-half of the patent to a trustee to vest the title in a corporation, and has imposed upon him and his estate the loss of the title to it, in consideration of his agreement to convey his half of the patent to the same corporation and to make the specified transfers of stock, and he cannot now rescind or renounce his contract. He must perform it and seek in damages his remedy for any breaches of incidental or subordinate agreements.

The next objection to the decree is that the contract is so uncertain that a court of equity may not justly decree its performance because it contains no stipulation which specifies the amount of the capital of the corporation to be organized, the amount, if any, of treasury stock it should have, the amount, if any, of stock which James G. Owen should use in its organization and promotion, the price per share at which it should be sold, the amount of capital which should be raised by James G. Owen in its organization and promotion, the state under whose laws it should be organized, whether or not its certificate of incorporation should provide for cumulative voting, and other similar possible or probable corporate attributes or concomitants, and in support of this objection counsel refer to evidence that at the time the contract was made the parties agreed to leave the amount of the capital stock of the corporation for future determination, and that at a subsequent time James G. Owen and Howe agreed that it should be $1,000,000. But neither this testimony nor the presence nor absence of any agreement with reference to the details of a corporate organization here suggested was either material or relevant to any issue in this case. No agreement about any of these corporate attributes or details of organization was either

essential or material to a certain and definite contract for the purpose for which this agreement was made. That purpose was to make a trust deed and a contract effective to put the title to the patent in a corporation and to cause the stock of the corporation to be distributed among the parties entitled thereto in the proportions specified in the trust deed. This object was as clearly and definitely evidenced and accomplished by this agreement, which specified the exact proportion of the stock which each party should receive as it could have been if the total amount of the capital stock and all other omitted details suggested had been determined and written down. Whatever the capital stock of the corporation might be, the shares of the respective parties therein were fixed to a legal certainty by this agreement and their rights made definite and judicable. The deed and agreement were complete in themselves, all their essential terms were definite and certain, and their specific performance was enforceable in equity. Another contention is that the contract was for an option, that it was unilateral, and that James G. Owen was guilty of laches in forming the corporation. But, as has been shown, the contract of Howe was an executory agreement in consideration of the executed trust deed of Elmo C. Owen. It was neither an agreement for an option nor a unilateral contract. James G. Owen, the trustee named in this deed, may lawfully enforce the agreement on behalf of the widow and child of Elmo Owen and the other beneficiaries named therein. On October 10, 1902, Howe notified Owen that he expected him to organize the company within the next 30 days. The certificate of organization of the corporation is dated November 6, 1902. This suit was brought in July, 1903. A suit to enforce the specific performance of a written contract may be maintained at any time within 10 years after default in the courts of Missouri (Rev. St. 1899, § 4272 [Ann. St. 1906, p. 2347]), and the doctrine of laches is generally applied in conformity to the analogous statute for the like action at law. Neither Owen nor the corporation were guilty of any culpable laches in this case.

On February 19, 1902, Elmo C. Owen and the defendant Howe made a written contract with Thomas Leyden that he should advance to them $5,000 to make and test some ball bearing journal boxes; that after the test they would organize a corporation with a capital stock of $250,000; that the patent should be conveyed to this corporation; that its stock of the par value of $95,000 should be placed in its treasury; that its stock of the par value of $20,000 should be issued to Leyden, and its stock of the par value of $135,000 should be issued to Elmo Owen and Howe; and that the corporation should pay to them 10 cents for each ball bearing journal box manufactured. There is testimony in the record to the effect that in the course of the negotiation for this agreement before and at the time it was made there were oral contracts that Leyden should have the same interest in the patent before as after the organization of the corporation, and that he should participate in its organization. But under a familiar rule the written contract must be conclusively presumed to embody the entire agreement of the parties and to

express the full extent of their obligations. These parol negotiations and covenants are immaterial and will not be farther noticed. Leyden advanced the $5,000, and counsel for Howe assail the decree on the ground that Leyden had an interest in the patent, and that the decree injuriously affects his rights. No decree may be lawfully rendered in a suit in equity which radically and injuriously affects. the rights or interests of an absent party. Shields v. Barrow, 17 How. 130, 138, 141, 15 L. Ed. 158; Cameron v. McRoberts, 3 Wheat. 591, 4 L. Ed. 467; Mallow v. Hinde, 12 Wheat. 197, 6 L. Ed. 599; Kendig v. Dean, 97 U. S. 423, 426. 2: L. El. 1061; Northern, etc., R. Co. v. Michigan, etc., R. Co., 15 How. 233, 244-246, 14 L. Ed. 674; Chadbourne v. Coe, 2 C. C. A. 327, 51 Fel. 479; Sioux City, etc., W. Co. v. Trust Co., 27 C. C. A. 73, 82 Fed. 124. But the only right Leyden had here was the right to a specific performance of his contract or to damages for its breach. He is not a party to this suit, and is not bound by this decree, and he will not be, unless he exercises his option to accept the stock adjudged to him thereby. The decree neither deprives him of any remedy nor affects his rights or interests. The corporation to which the title to the patent is to be conveyed and all who receive any of its stock under the decree take with full notice of his contract and of his rights and interests thereunder and subject thereto. He is and will be as free to enforce them against the corporation and its stockholders as he was to urge them against Owen and Howe before this suit was commenced, and he can as easily and efficiently enforce them against the latter as the former.

Nor does the condition of the title to the patent present any obstacle to the decree or to its execution. A court of equity may not adjudge that a defendant who has no title shall convey one. The holder of the title is an indispensable party to a decree for its conveyance. Kennedy v. Hazleton, 128 U. S. 671, 9 Sup. Ct. 202, 32 L. Ed. 576. But Leyden has no title to the patent or to any part of it. The limit of his right is to exercise his option to enforce specific performance of his contract, or to recover damages for its breach, if any. The entire title to the patent is in Howe and James G. Owen as trustee. They are parties to the suit, and the court may require them to transfer this title. Because the entire title to the patent is in the parties to the suit, and because the decree does not radically or injuriously affect any of the rights or interests of Leyden, his contract presents no legal or equitable obstacle to it.

Finally, it is contended that James G. Owen occupied such a confidential relation to his brother Elmo and to Howe that he could not lawfully acquire and hold his rights under the trust deed and contract to a share in the stock of the corporation which he has organized. He was an attorney at law. He had frequently advised Howe and his brother Elmo in relation to their patent and in relation to the formation of a corporation. But this appears to have been friendly advice, and no relation of attorney and client has been proved. The trust deed and contract were dictated by another attorney, agreed upon by Howe and James G. Owen, and written out by the latter. The principle of law which in some cases forbids one from holding property acquired through a fiduciary relation does not denounce or de

stroy all rights and titles thus acquired. It is that one who occupies a fiduciary relation to another in respect to business or property, who by the wrongful use of the knowledge he obtains through that relation, or by the betrayal of the confidence reposed in him under it, acquires a title or interest in the subject-matter of the transaction antagonistic to that of his correlate, thereby charges his title or interest. with a constructive trust for the benefit of the latter, which the cestui que trust may enforce or renounce at his option. The test of such a trust or prohibition is the fiduciary relation and a betrayal of the confidence reposed or some breach of duty imposed under it. Steinbeck v. Bon Homme Min. Co. (C. C. A.) 152 Fed. 333; Boone v. Chiles, 10 Pet. 177, 209, 9 L. Ed. 388. James G. Owen occupied no confidential or fiduciary relation to Howe within the meaning of this principle of the law. He betrayed no confidence reposed in him, and he was guilty of the breach of no duty which he owed to Howe. The latter knew the value of the patent as well as Owen. He understood the terms, the meaning, and the effect of his agreement to transfer to Owen 21/250 of his share of the stock of the corporation just as well as Owen understood it, and he told Elmo that the contract was right and covenanted in writing to perform it. There was no betrayal of confidence or breach of duty here, and the court below rightly enforced the performance of the agreement.

The decree below must be affirmed, and it is so ordered.

HESSIAN v. PATTEN et al.

(Circuit Court of Appeals, Eighth Circuit. July 5, 1907.)

No. 2,503.

1. FRAUDULENT CONVEYANCES-VOLUNTAry Deed.

A voluntary conveyance by an insolvent grantor is fraudulent In itself because it cannot be made without hindering and defrauding his creditors.

[Ed. Note. For cases in point, see Cent. Dig. vol. 24, Fraudulent Conveyances, §§ 138, 139, 188.]

2. SAME WHEN VOLUNTARY DEED BY PARENT TO CHILD IS NOT FRAUDULENT. A voluntary conveyance by a solvent father to his child is not necessarily voidable by his existing creditors, and it is valid against subsequent creditors in the absence of evidence that it was made with intent to defraud them.

If the provision be reasonable, if it leave in the hands of the grantor ample property to pay his existing debts, and if there be no intent to defraud existing or subsequent creditors, it may be sustained.

[Ed, Note.-For cases in point, see Cent. Dig. vol. 24, Fraudulent Conveyances, §§ 141, 144, 145.]

3. SAME-WANT OF CONSIDERATION INSUFFICIENT TO AVOID.

The want of consideration is only a circumstance insufficient in itself to prove a fraudulent intent, but from which and other circumstances such an intent may be inferred.

[Ed. Note. For cases in point, see Cent. Dig. vol. 24, Fraudulent Conveyances, §§ 186, 189.]

4. SAME-DEED FOR USE OF GRANTOR NOT VOIDABLE IF RESERVATION INCIDENTAL AND PARTIAL.

The rule that, a conveyance in trust for the use of the person making the same is voidable by creditors of the grantor is inapplicable to a deed which is made primarily and principally for the use of the grantee, and in which the reservation for the grantor is secondary and partial, as in the case of a conveyance by an aged man of a lot and building worth $9,000 and a reservation in the deed of possession of the property during his life.

[Ed. Note. For cases in point, see Cent. Dig. vol. 24, Fraudulent Conveyances, § 352.]

(Syllabus by the Court.)

Appeal from the District Court of the United States for the District of Minnesota.

Edmund S. Durment and Benjamin Taylor (Albert R. Moore, on the brief), for appellant.

A. R. Pfau, Jr. (A. R. Pfau, Sr., M. J. Severance, and Ora J. Parker, on the brief), for appellees.

Before SANBORN and HOOK, Circuit Judges, and PHILIPS, District Judge.

SANBORN, Circuit Judge. This is an appeal from a decree which dismissed the bill of Thomas Hessian, trustee in bankruptcy of the property of William H. Patten, and of the property of William A. Patten, his son, who were copartners, to avoid a deed of a lot and a store building thereon made by William H. Patten to his daughter, Mrs. Lodusky J. Taylor on February 15, 1902. William H. Patten and William A. Patten were adjudged bankrupts as individuals and as copartners on November 20, 1903. The deed to Mrs. Taylor was recorded on August 3, 1903, within four months prior to the adjudication. Counsel for the appellant contend that this deed was never delivered; that, if it was, the time of its delivery was not before August 3, 1903; that it was a voluntary deed; that it was made with intent to defraud the creditors of the grantor and those who might thereafter become his creditors; and that it was not intended to take effect until the grantor died, so that it was a testamentary disposition, and not a conveyance of the property. If these claims are well founded, the deed must be avoided, and the question is whether or not the evidence sustains them. There is little controversy in the testimony and the issues involve the effect, rather than the existence, of the following facts, which are fairly established by the proof.

William H. Patten had been an upright and successful business man. In 1893 he and his son owned property worth about $63,000, which they invested in the business of their partnership, which subsequently became the business of banking. William H. Paten owned a portion of this partnership property which was worth $33,000, and he also owned a homestead worth about $6,000, the lot and store building here in controversy which were worth about $9,000, and other individual property. He owed nothing, was 66 years of age, and from that time until he died he intrusted the business of the partnership to his son and took no active part in it. He had a