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Court. The Supreme Court held that the case should have been remanded. In the course of the opinion the court said:

"But it is contended that [the defendant] was entitled to remove the case to the Circuit Court, and, as by his petition for removal he waived the objection so far as he was personally concerned, that he was not sued in his district, hence that the Circuit Court obtained jurisdiction over the suit. This does not follow, inasmuch as in view of the intention of Congress by the act of 1887 to contract the jurisdiction of the Circuit Court, and of the limitations imposed thereby, jurisdiction of the suit could not have obtained, even with the consent of both parties."

By the last clause quoted the plaintiff here argues the Supreme Court declared that "even with the consent of both parties" this court cannot take jurisdiction of this proceeding, and so the case must be remanded to the state court. But this cannot be the correct interpretation of the dictum just quoted. As it stands, it is applicable alike to suits brought originally in the Circuit Court, and to those removed there. Yet in the Wisner Case the Supreme Court went on to observe: "In Central Trust Company v. McGeorge, 151 U. S. 129, 14 Sup. Ct. 286, 38 L. Ed. 98, it was assumed, however, that the requirement that no suit should be brought in any other district than that of the plaintiff or of the defendant might be waived, where neither resided therein, because in that case the nonresident plaintiff had sued in the Circuit Court and the nonresident defendant had answered on the merits, which showed the consent of both parties and not unnaturally led to the result announced, while in this case there was no such consent."

in Martin v. B. & O. R. R., 151 U. S. 673, 688, 14 Sup. Ct. 533, 38 L. Ed. 311, the petition for removal had been filed in the state court so late that the plaintiff might have insisted upon a demand. He did not raise the question until he reached the Supreme Court on writ of error. The court said:

The time of filing a petition for the removal of a case from a state court into the Circuit Court of the United States for trial is not a fact in its nature essential to the jurisdiction of the national court under the Constitution of the United States, like the fundamental condition of a controversy between cit izens of different states. But the direction as to the time of filing the petition is more analogous to the direction that a civil suit within the original jurisdiction of the Circuit Court of the United States shall be brought in a certain district, a noncompliance with which is waived by a defendant who does not seasonably object that the suit is brought in the wrong district."

Here the Supreme Court did not expressly assert that the plaintiff as well as the defendant might waive the objection raised in the case at bar, but the implication to that effect is strong. And in the Wisner Case the court said, referring to Kinney v. Columbia Association, 191 U. S. 78, 24 Sup. Ct. 30, 48 L. Ed. 103:

"A petition and bond for removal are in the nature of a process. They constitute the process by which the case is transferred from the state to the federal court.' When, then [the defendant] filed his petition for removal, he sought affirmative relief in another district than his own. But the plaintiff. in resisting the application and moving to remand, denied the jurisdiction of the Circuit Court."

If, where the process is the plaintiff's, the defendant may give this court jurisdiction by consent, it would seem to follow that where the process is the defendant's, the plaintiff may give jurisdiction by consent.

In Foulk v. Gray (C. C.) 120 Fed. 156, referred to in the statement of the Wisner Case as representing the view which was taken of the question by the Supreme Court, the Circuit Court held that the plaintiff's consent, after removal of the cause to the Circuit Court, would waive that objection to the jurisdiction which he might have taken had he desired to do so. Therefore it follows that in a case like this the plaintiff may waive his objection to the removal. If he does so, this court will have jurisdiction, as in the cases above cited. Did this plaintiff's action after removal here amount to a waiver?

Of this there can be no doubt. A general appearance is sufficient, and here the plaintiff went much farther. This court has jurisdiction, and the plaintiff's motion to remand must be denied.

In re EDENS CO.

(District Court, D. South Carolina. April 2, 1907.)

1. BANKRUPTCY-PROOF OF CLAIMS-ATTORNEY'S FEES.

Where notes given by a bankrupt provided that if they were placed in the hands of an attorney for collection the maker agreed to pay 10 per cent. attorney's fees in addition to principal and interest, and the notes matured and were placed in the hands of an attorney for collection before the maker became a bankrupt, the creditor was entitled to prove his claim for such attorney's fees in addition to the amount of the note; but the rule is otherwise with reference to claims which did not mature until after the institution of bankrupt proceedings. 2. SAME-Waiver.

Where an alleged agreement as to the fee to be allowed the attorney for petitioning creditors of a bankrupt was not in writing, and no proof was offered to controvert his statements that there was no agreement on his part to waive the claim of the creditors to the 10 per cent. attorney's fees provided for in notes held by them, such alleged agreement limiting the creditors' attorney's fee to $150 could not deprive the creditors of their right to have the 10 per cent. on their notes allowed for attorney's fees as a part of their claim.

In Bankruptcy. On certificate of referee.

Mark Reynolds, for creditors.

H. D. Moise, for bankrupt.

BRAWLEY, District Judge. The question here presented comes up upon a certificate from I. C. Strauss, Esq., referee in bankruptcy at Sumter, S. C., which, in brief, is as follows: Mark Reynolds, Esq., attorney for certain creditors, offered for filing and allowance a claim of Anderson Phosphate & Oil Mill of Anderson, S. C., amounting to the sum of $4,035.24, the said claim being based upon three promissory notes, the originals of which are attached to the proof of claim made in the form prescribed by the bankrupt law. There is a clause at the foot of each of said notes which provides as follows:

"And if this note is collected by suit or placed in the hands of an attorney for collection, I promise to pay 10 per cent. attorney's fees in addition to principal and interest."

At the hearing before the referee, H. D. Moise, Esq., attorney for the bankrupt, objected to the allowance of this claim, upon the ground

that an agreement had been entered into by himself as attorney for the bankrupt, fixing the fees for the attorney for creditors in the bankruptcy proceedings at a stipulated amount; that the said attorney was not entitled to collect any further fees in excess of the amount stipulated in the agreement, and that the referee, if he allowed the claim including attorney's fees, would allow the attorney for the creditor fees in excess of the amount he had agreed in writing to take. The referee allowed the claim in full, upon the ground that the agreement adverted to was not before him and the question could not be considered by him, and the matter is certified to this court, as to the correctness of his ruling, for its opinion thereon. At the hearing before this court, on March 30th, Mr. Reynolds, the attorney for creditors, made a similar demand for attorney's fees upon the claim of the Combahee Fertilizer Company, which was proved for $3,500.68, and based upon three separate notes each in the sum of $1,161.71, maturing at different dates, but only one of which fell due prior to the institution of bankruptcy proceedings, and upon that one alone the 10 per cent. attorney's fees are asked. Mr. H. D. Moise, attorney for the bankrupt, presented upon the hearing the same objections made before the referee, and made argument to sustain his position.

It seems clear that as the notes in question are in legal contemplation a contract between the parties, the clause providing for attorney's fees therein becomes a part of the debt itself, enforceable in law, and if said notes, or any one of them, fell due before the institution of bankruptcy proceedings the whole amount is provable as a claim against the fund in the hands of the trustee in bankruptcy. The bankrupt act (Act July 1, 1898, c. 541, 30 Stat. 544 [U. S. Comp. St. 1901, p. 3418]) recognizes all valid contracts executed prior to bankruptcy proceedings, and unless impeached upon the ground of fraud or some other valid legal ground, courts of bankruptcy will uphold and enforce them. The petition in bankruptcy in this case was filed November 23, 1906.

A similar question was presented to and decided by the United States Circuit Court of Appeals for the Fifth Circuit in the case of Merchants' Bank of Grenada v. Thomas, 10 Am. Bankr. R. 299, 121 Fed. 306, in which Judge Shelby, delivering the opinion of the court, says:

"Each one of the five notes contains an agreement that if this note is placed in the hands of an attorney for collection the makers and indorsers hereof agree to pay the holder of this note an attorney's fee of 10 per cent. upon the amount due. An agreement [the court goes on to say] by which the maker of a promissory note or other contract binds himself to pay a reasonable attorney's fee if the contract is not performed according to its terms, and the other party is required to take steps to enforce it, has generally been held just and valid. Machine Co. v. Moreno (C. C.) 7 Fed. 806. It is but a reasonable stipulation for indemnity for expense which the debtor may himself render necessary. A promissory note providing for the payment of attorney's fees, if placed in the hands of an attorney for collection involves exactly the same question, and a note containing a stipulation in that form was held valid in Barton v. Bank, 122 Ill. 352, 13 N. E. 503. There is no conflict in the evidence that these notes were placed in the hands of an attorney for collection, and that he has performed services in endeavoring to collect them. For such services the bank is indebted to the attorney, and the purpose of the stipulation is to indemnify the bank against such expense. We are of opinion that on the record before us the five notes, including attorney's fees of

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10 per cent. are provable claims against the estate of the bankrupt, and an order permitting them to be so proved must be entered."

The case before this court for decision is "upon all fours" with the case just cited, and the reasoning and conclusions are adopted as the principles controlling in this case. It only remains to consider the other question made in argument by the attorney for the bankrupt, that the court should not allow the claims to be proven with attorney's fees added in view of the fact that the agreement had with the attorney for creditors was that he would accept $150, as his compensation in the bankruptcy proceedings, and that he should be confined to that amount in full of all demands against the estate. The attorney for creditors states that he never so intended. The petition in bankruptcy was filed on behalf of other creditors than those whose claims are now under consideration, and the attorney for creditors further states that he performed valuable services endeavoring to collect the notes in question prior to the bankruptcy proceedings, and before he contemplated resorting thereto. The agreement as to the fee to be allowed the attorney for petitioning creditors was not in writing, and, inasmuch as no proof is offered to controvert his statements that there was no agreement on his part to waive the claim of the creditors to the 10 per cent. due on the notes in question, such creditors cannot be deprived of their rights.

The report of the referee on this point is therefore sustained; but he is directed to eliminate any allowance of 10 per cent. upon claims which were not due prior to the institution of bankruptcy proceedings.

In re SPITTLER.

(District Court, D. Connecticut. March 7, 1907.)
No. 1,422.

BANKRUPTCY-PROVABLE DEBTS-DAMAGES FOR BREACH OF EXECUTORY CON

TRACT.

Where a bankrupt shortly prior to his bankruptcy gave notice to the other party to an executory contract that he would be unable to perform on his part because of his financial condition, such other party may treat the contract as broken, although the time for performance has not ar rived and prove his claim for damages for the breach against the estate in bankruptcy under Bankr. Act July 1, 1898, § 63a (4), c. 541, 30 Stat. 563 [U. S. Comp. St. 1901, p. 3447], where it is of such nature that it may be liquidated under subdivision "b" of said section.

In Bankruptcy. On certificate from referee in re claim against bankrupt.

Edward H. Rogers, for trustee.

L. J. Nickerson, for claimants.

PLATT, District Judge. On March 15, 1901, claimants A. W. North and the Kellogg & Wakefield Manufacturing Company made an agreement with the Vulcan Manufacturing Company (of which the bankrupt was president and owner of nearly all the stock) to sell the

capital stock and manufacturing plant of the Kellogg & Wakefield Company, which was controlled by North, for $40,000, of which $1,000was paid down, and the balance was to be paid on or before December 1, 1905. It was further agreed that payments upon the purchase price might be made from time to time prior to December 1, 1905, at the vendees' option. It was also agreed that a lease of said premises. should be on that day made and executed to said vendees for two years from and after December 1, 1903, which was the time when the bankrupt and the Vulcan Manufacturing Company actually took possession, and the agreement was verbally made, although, as recited, the agreement was not reduced to writing until March 15, 1904. Under said lease the rental was fixed at 10 per cent. of the unpaid portion of the purchase price, whatever from time to time that might be, payable quarterly, on the first days of March, June, September, and December.

The actual value of the property so taken into possession was $40,000. Its actual value at the time of adjudication was $33,000. On February 18, 1905, the property was delivered into the possession of the claimants, and the trustee has not elected to assume the rights of the bankrupt under said agreement of sale or lease. In September, 1904, said Vulcan Manufacturing Company became financially embarrassed, and Mr. Spittler was appointed receiver by the state court. In December, 1904, Mr. Munn, as attorney for the claimants, made a demand upon said Spittler, now the bankrupt, but then the receiver, that he perform the terms of the lease and carry out the agreement upon which the present claim is predicated. Spittler thereupon informed Mr. Munn that it was absolutely impossible to pay the rent or to carry out the agreement because of his financial condition. The claim is founded upon said agreement and is for $6,000, which is found to be the depreciation in value of said property between the time when bankrupt and the Vulcan Manufacturing Company took possession thereof and the date of adjudication. The only question is whether in such circumstances the claim is provable in bankruptcy under Act July 1, 1898, c. 541, 30 St. 563 [U. S. Comp. St. 1901, p. 3447] section 63a (4). The amount is clearly enough established as provided for in section 63b, if the facts warrant the proof of the claim. The contract upon which this claim is based is executory, and the obligation to pay the remaining $39,000 thereunder did not become binding by its terms until December 1, 1905. The adjudication was nearly a year before that date. Upon the facts in this case, it is not necessary to decide broadly whether or not an adjudication in and of itself works a breach of an executory contract. I am willing to say, however, that if such a case presented itself, I think, from such examination of the law as I have made, that it would, as I am at present advised, be my duty to answer the question in the affirmative.

In this matter, however, there are other elements to be reckoned with. Prior to the bankruptcy proceedings, the vendee corporation, being financially embarrassed, had gone into the hands of a receiver under the jurisdiction of the state courts. Upon demand, Mr. Spittler, both as receiver and as the individual who dominated and controlled the corporation, had frankly confessed that the financial situation utterly prevented the carrying out the contract. On behalf of himself and

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