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(113 Fed. 669.)

(Circuit Court of Appeals, First Circuit. January 24, 1902.)

No. 404.


By well-settled rules, the individual liability of a stockholder in a Minnesota corporation is not to the corporation, but to its creditors; and hence, in a suit against such stockholder to enforce such liability, the defendant cannot set off an indebtedness due from the corporation to him.

In Error to the Circuit Court of the United States for the District of Massachusetts.

John Corcoran and William B. Sullivan (Crosby & Nixon, on the briefs), for plaintiff in error.

Stiles W. Burr (John W. Saxe, on the briefs), for defendant in error.

Before COLT and PUTNAM, Circuit Judges, and WEBB, District Judge.

PUTNAM, Circuit Judge. This suit was brought to enforce the liability of the defendant below as a stockholder in a corporation organized under the laws of Minnesota. The judgment of the circuit court was against him, and thereupon he sued out this writ of error. With the exception of a single particular, the case involves questions disposed of by us in Hale v. Hardon, 37 C. C. A. 240, 95 Fed. 747, and is determined by it.

It is not necessary to consider the proposition made by the defendant below that certain legislation of Minnesota, subsequent to his acquiring the stock in the corporation in question, is ineffectual, because, independently of that, the principles asserted in Hale v. Hardon are sufficient to sustain the judgment, unless the defendant below is entitled to an offset as a general creditor of the corporation. He is admittedly a general creditor for a larger amount than that claimed from him as a stockholder. Nevertheless, in order to lay the foundation of a right of set-off, either at law or in equity, the claims pro and con must be in the same interest. A trustee, enforcing a claim in behalf of his trust, is not subject to set-off of the claims of the debtor of the trust against the trustee individually. In the present case, the plaintiff below stands as the representative of the creditors of the corporation, and not of the corporation itself, so that the cross demands are not in the same interest within the rules applicable to set-offs. The underlying principle which applies in this respect has been so many times, and so thoroughly and broadly, stated by the supreme court, that it is not necessary for us to explain them further.

The judgment of the circuit court is affirmed, with interest, and the costs of appeal are awarded to the defendant in error.

(113 Fed. 865.)



(Circuit Court of Appeals, Second Circuit. January 7, 1902.)

No. 82.


Under article 24 of the navigation act of 1890, which provides that "every vessel overtaking any other shall keep out of the way of the overtaken vessel," where a tug with a tow saw a schooner a quarter of a mile ahead, on nearly the same course, and overtook and passed her, but the tow, which was on a 200-fathom line, did not see the schooner until within 200 feet, and struck her directly astern, negligence must be inferred on the part of both tug and tow, unless there is evidence to warrant a finding that the schooner in some way brought about


Evidence considered, and held not to sustain a claim made by a tug and tow that a schooner which they overtook, not seeing the tow, changed her course after the tug had passed and ran into its wake, thus causing by such act a collision between her and the tow, which struck her directly astern.

Appeals from the District Court of the United States for the Eastern District of New York.

This cause comes here upon appea from a decree of the district court, Eastern district of New York (108 Fed. 552), holding the tug and the barge both liable for damages sustained by the schooner Florence Shay in consequence of a collision with the barge while in tow of the tug about 3 a. m. of August 22, 1900, in Hampton Roads. The stem of the barge struck the schooner directly on the stern, and, the schooner coming around after the impact, her bow also came in contact with the barge. The following excerpt from the brief of the counsel for the tug briefly indicates the principal facts which are not in dispute: “The Florence Shay was a small, threemasted schooner, laden with coal, bound into Hampton Roads for an anchorage on account of the strong N. E. wind outside. The Nathan Hale was returning to the roads with the barge Doris in tow for the same reason.

The hawser between the tug and tow was about 200 fathoms in length, the tide was turning flood, the night good for seeing lights, and the wind moderate from the N. E. The steam tug, after passing Old Point Wharf on a course S. W. by W., and steering for the light on the Middle Ground, sighted the schooner a little upon her port bow, and about a quarter of a mile away. The schooner also sighted the stean tug over her starboard quarter, the tug showing her red and towing lights, when about a quarter of a mile away.

When the steam tug observed the schooner, her course was changed to half a point to starboard, and the schooner's course was changed to half a point to port; the steam tug having the light of the Middle Ground just over her port bow, and the schooner having the same light just over her starboard bow. The tug passed the schooner on her starboard side at a distance variously estimated at from 300 feet to 300 yards. The collision occurred off Hampton Bar, the stem of the barge striking the stern of the schooner. The schooner at the time had up all her lower sails."

Samuel Park, for the Nathan Hale.
Le Roy S. Gove, for the Doris.
Nelson Zabriskie, for appellee.

Before WALLACE and LACOMBE, Circuit Judges, and TOWNSEND, District Judge.

PER CURIAM. The opinion of the district judge will be found in 108 Fed. 552. It contains an exhaustive discussion of the evidence, which it seems unnecessary to reproduce here. Some of the propositions of fact which he found are controverted, and it is contended that in working out suggested movements of the vessels he overlooked some elements which should have been considered; e. g., that a luffing up by the schooner when she was going almost before the wind would have increased her speed, and that a barge as heavy as the Doris could not have swung far out of the wake of the tug without changing the tug's heading. But these minuter details of the argument contained in the opinion need not be considered. The fundamental ground for the decision is found in the opening statement of the opinion:

“The first obvious fact is that a schooner, which had been seen by those on a tug 1,500 feet away, was struck squarely in her stern by the tow, which did not see the schooner until within about 200 feet of her. From this fact negligence should be inferred both on the part of the tug and the harge, unless there is some fact which should modify or avoid that conclusion."

Article 24 of the act of 1890, as it stood when the collision happened, reads as follows:

"Notwithstanding anything contained in these rules every vessel, overtaking any other, shall keep out of the way of the orertaken ressel.”

Whether the distance at which the tug passed was greater or less, whether the courses were diverging or converging, whether or not the tug failed to warn its tow to follow the slight change to starboard which it made, whether the tow swung more or less out of the wake, is not material to the question presented here. The tug saw the schooner a quarter of a mile off, and saw in what direction she was going. The tow failed to see her till within 200 feet. Both tug and tow were overtaking vessels, and the latter ran squarely into the schooner's stern. In view of the rule, the only question seems to be, is there evidence which will warrant the finding that the schooner in some way brought about this catastrophe? There is some suggestion of an insufficient light astern, but, if she had none at all there, that circumstance would be immaterial, since it was so light that the schooner was visible a quarter of a mile away. That, when she sighted the tug, she changed a half point to port, is not charged as a fault. It was a change in avoidance of collision greater than she was required to make. All the rule asked of her was that she should keep her course. The tug and barge claim that the “schooner changed her course to starboard in order to approach the anchorage grounds, not having observed the barge." There is no evidence to support this proposition. The witnesses from the schooner testify that she made no such change. No witness called by either party asserts that he saw her on any such course. She was not on it when the tug passed her, nor when the tow sighted her, nor when she was struck. It is a theory advanced to account for the collision, under the assumption that the tug passed at a safe distance, and that the barge kept in her wake. The inere iact of collision, however, equally well supports the inference that claimants' witnesses are mistaken as to both these propositions. And in this, as in all such cases, great weight may fairly be given to the improbability that a vessel, whose master knows she is being overtaken by a vessel, which is in such a position that she cannot help but know she is herself overtaking, should make any such change, when, under the plain text of the rule, no new navigation on her part is called for, and all she has to do is to keep her course, and let all overtaking vessels keep out of her way. It is sought to overcome this suggestion by contending that, after the tug had passed, the master of the schooner, who did not see the tow, would be likely to change to starboard to make an anchorage near Hampton Bar. But in our opinion the evidence does not warrant such a conclusion. The master of the schooner testified that he was bound up towards Middle Ground for an anchorage, where there was a little shoal water, which was about two miles beyond the place of collision; that he never anchored down at the place of collision, the water being 12 to 14 fathoms there,—too deep for his class of vessel,—whereas where he usually anchored, and intended to at this time, there were four or five fathoms, right up to the north and eastward of the Middle Ground light, between Hampton Bar and Middle Ground light. The mate of the schooner, in response to a question where they intended to anchor, replied, "Oh, around Hampton Bar.” The chart indicates a bar which runs from Old Point to Newport News. It is designated as “Hampton Bar," its westerly end, opposite Middle Ground light, being designated as "Newport News Bar." Between that and Middle Ground light the water is 372 to 5 fathoms. In answer to another question, he said they intended to anchor “somewhere on Hampton Bar to the eastward,—to southeast of us.” Manifestly there is some clerical error in the record. To the "eastward" or "southeast" would be water beyond which the schooner had already passed. Further on in his cross-examination he stated that they made all ready for anchoring between the Capes and the Thimble; that at the time of collision they were all ready to let go the anchor; that they could not anchor at the place of collision, because there was too deep water; that they were intending to go up to the Middle Ground to anchor,-between Middle Ground and Hampton Bar,-in about 5 or 6 fathoms; and that in order to make the anchorage they would not have to change their course until they got a mile further up ("up-channel" he evidently meant), when a change from S. W. 12 S. to W. by N. would bring them where they wanted to go. These witnesses evidently designated the whole bar as “Hampton Bar,” ignoring the fact that the chart designates its westernmost end as “Newport News Bar.” Reading the testimony with chart before us, we are clearly of the opinion that at the moment of collision the schooner was a mile short of the place where it would be necessary to change her course—even if there were no other vessel to be considered in order to make the anchorage she was aiming for. In view of this circumstance, we cannot find, in the absence of any evidence of a change of course, that she turned sharply to starboard and ran into the wake of the tug.

The decree of the district court is affirmed, with interest and costs.

(113 Fed. 868.)


(Circuit Court of Appeals, Second Circuit. January 14, 1902.)


An error in extremis cannot be urged in exculpation of a vessel whose prior negligence has brought about the situation in which a mistake

in judgment is excusable. 2. SAME-TUG AND Tow-Passing DISABLED VESSEL.

A tug passing down a stream with a schooner in tow, held in fault for a collision between her tow and another tug which had become disabled and was unmanageable, because she failed to see the disabled vessel, and note her condition or hear her alarm signals, until so close upon her that the collision could not be avoided. Appeal from the District Court of the United States for the Southern District of New York.

Chas. D. Cleveland, for appellant.
Le Roy S. Gove, for the Golden Age.
Peter Alexander, for the Protector.
Before WALLACE and LACOMBE, Circuit Judges.

WALLACE, Circuit Judge. The court below was of the opinion that the collision between the tug Golden Age and the schooner in tow of the tug Protector was an accident of navigation, happening without any specific fault on the part of either tug, and for that reason dismissed the libel of the schooner. Each tug alleged in its answer, and attempted to prove, that the schooner was improperly navigated, and that the collision would not have taken place if she had followed the movements of the Protector. The court below was of the opinion that these allegations were unfounded, and we are of the same opinion, being satisfied that the schooner was properly navigated. We also agree with the court below in the conclusion that the Golden Age was not at fault. The real question to be determined upon this appeal seems to be whether the Protector should be exonerated.

The collision took place in broad daylight, on Newtown creek, a stream at that part of it running east and west, and 250 feet wide. An ebb tide, setting to the westward, was running slowly. The Golden Age, a tug about 60 feet long, while backing towards mid-stream from the northerly shore, preparatory to throwing her bow around to the westerly to go down stream, caught a submerged log in her propeller, her stern being at that time about mid-channel, and distant from the drawbridge westerly something more than 150 feet. She had heard the signal indicating the intention of a vessel approaching the draw from the eastward to pass through, and when she became disabled sounded alarm whistles, and as she saw the vessel, which proved to be the Protector, entering the draw, sounded alarm whistles again. At that time the Protector was proceeding westwardly with the libelant's schooner in tow on a hawser of 60 feet. As she approached the draw she slowed down to half speed. In the meantime the Golden

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