want of jurisdiction of the subject-matter. An appeal was taken by the trustees, and is apparently unprosecuted, and certainly undetermined. Complainant therefore requested said trustees to bring suit in this court, which they declined to do. The demurrants insist that complainant is not entitled to maintain this action unless it be shown that the trustees have refused to accede to a "written request of the holders of a majority of the bonds then outstanding." Whether or not, as urged by the complainant, the bringing of a suit in a court without jurisdiction of the subject-matter is a failure to comply with the written request, need not be now considered. There is no restriction in the deed of trust upon the right of the coupon holder, without assent of a majority of the bondholders, to foreclose for interest upon default, except when advantage is sought to be taken of that default as advancing the date when the principal becomes due. This suit may in any event be sustained for interest due, (Railroad Co. v. Fosdick, 106 U. S. 47, 1 Sup. Ct. Rep. 10;) whether it can be sustained for principal may be determined upon the trial.

4. The objection that the bill is not filed on behalf of all other bondholders similarly situated is wholly unwarranted by an inspection of its

terms.

5. The next proposition advanced in defendants' brief, namely, that the demurring defendants' claims to the property covered by the mortgage are independent and adverse, may be true in fact, but it certainly does not appear on the face of the bill. To the Hudson River West Shore Railroad Company alone was the consent to build a railroad through the West Point reservation given by act of congress. The court will not take judicial notice upon argument of a demurrer that $600,000 is not enough to build such railroad,-which is apparently what the demurrants' counsel expects it to do. For all that appears, the road was substantially completed by the two original companies, and the complainant expressly avers that a large sum of money was expended by them in connection with the property which is averred to be covered by the mortgage. Across the West Point reservation there is now operated by the demurring defendants a railroad, which is so operated only by virtue of the act of congress above cited. The only title to this which it is averred the New York Central & Hudson River Railroad Company has, is as lessee in possession of the defendant the West Shore Railroad Company. The only title which it is averred the last-named defendant holds has come to it through many hands indeed, but ultimately from conveyances made by the mortgagors subsequent to the mortgage. As owner of the equity, and as lessee in possession, the demurrants are proper parties defendant. 6. The demurrants next contend that complainant has slept so long upon his rights that by reason of lapse of time and his own laches he is not entitled to relief. There is no pretense that the suit is barred by any statute of limitations. If delay for any less period than that prescribed by the statute is sought to be availed of in bar of complainant's right to recover, the fact of such delay is a mixed question of law and fact, which should not be passed upon on demurrer.

7. It is further contended that the bonds on which complainant sues

are not valid obligations, for the reason that the "pretended West Shore Hudson River Railroad Company never was a corporation." That corporation was organized under the general railroad act (1850) of New York, "for the purpose of constructing, maintaining, and operating a railroad for the public use in the conveyance of persons and property, from a point in the boundary line between the states of New Jersey and New York on or near the west bank of the Hudson river, extending northwardly to the village of Piermont, in Rockland county, N. Y., and intersecting with the Erie Railroad and the southern terminus of the Hudson River West Shore Railroad; also cominencing at the northern terminus of the aforesaid Hudson River West Shore Railroad, as the same had been, was, or might thereafter be, located at or near the city of Newburgh, Orange county, N. Y., and extending northerly along the west bank of the said Hudson river through the counties of Orange, Ulster, Columbia, and Greene, and terminating at Athens, in said county of Greene, state of New York." The quotation is from the bill, and, it is contended, indicates an undertaking to build two railroads, whereas the statutes only authorize the incorporation of a company to build a railroad. As a matter of fact, the routes southerly to the state line and northerly to Athens touch the respective south and north termini of the route of the Hudson River West Shore Railroad Company. Whether that circumstance, taken in connection with the general power to lease and make traffic arrangements, conferred upon all railroad corporations by the act of 1839, (chapter 218,) does or does not deprive the objection of force, need not be now considered. The validity of the incorporation has never been questioned in a direct proceeding by the state, nor by those interested in the corporation. It has acted continuously as a corporation; as such acquired the mortgaged premises, and created the mortgage debt; as such received the proceeds of these very bonds, and put them into the road covered by the mortgage. Objection to the validity of the corporation comes for the first time from these demurrants, the West Shore Railroad Company and the New York Central & Hudson River Railroad Company. The only claim, however, which, so far as the bill discloses, these demurrants advance to the mortgaged premises,-to the concession granted by congress to the Hudson River West Shore Railroad Company,―is based upon the transfer by the West Shore Hudson River Railroad Company to the New York, West Shore & Chicago Railroad on July 21, 1871. It does not lie in the mouths of these demurrants to dispute the existence of the corporation whose acts constitute their own sole source of title. If they have some independent and adverse claim, it is nowhere disclosed in the bill. See 2 Mor. Priv. Corp. § 746 et seq.; Trust Co. v. Railway Co., 1 Railway & Corporation L. J. 50; Society Perun v. Cleveland, 43 Ohio St. 481; Palmer v. Lawrence, 3 Sandf. 161; Williamson v. Association, 89 Ind. 389; Railway Co. v. Railroad Co., 32 N. J. Eq. 755; Church v. Pickett, 19 N. Y. 482; Whitney v. Wyman, 101 U. S. 392; Hervey v. Railway Co., 28 Fed. Rep. 169.

8. Finally, it is urged that the mortgage created no lien upon the property of the Hudson River West Shore Railroad Company. The

bonds to secure which the mortgage was executed were, as recited in the mortgage, bonds of the West Shore Hudson River Railroad Company, issued for the purpose of enabling the latter company to acquire a lease of the road and entire property and franchises of the former, and to build, furnish, and operate its own road. The demurrants contend that a railroad company has no power to mortgage its property to secure the debt of another company. Without discussing the precise question thus raised, it is sufficient to call attention to the fact that the mortgage is a joint one executed by both roads, and covers "all and singular the railways of the parties of the first part hereto, constructed or hereafter to be constructed, [between the state line and Newburgh, ] and also all and singular the franchises now owned, possessed, or acquired by the said parties of the first part, or either of them, for the purpose of building, maintaining, and operating their respective lines of railway," etc. Either prior or subsequent to the mortgage-the phraseology of the bill does not leave the date altogether certain-the Hudson River West Shore Railroad Company leased its road for the entire term of its corporate existence to the West Shore Hudson River Railroad Company, and its entire capital stock was transferred to the latter company. The right of the West Shore Hudson River Railroad Company to mortgage its own property to secure its own bonds is not disputed; and, even if the lease and transfer of stock were not made until after the mortgage, they would be covered by it as after-acquired property, unless such lease and transfer were void. That they were void these demurrants contend, but their own title depends upon the validity of these very transfers. The concession of congress was to the Hudson River West Shore Railroad Company. Nothing is shown qualifying the title of that corporation to this concession, except the mortgage, the lease, and the transfer. The two last instruments are operative, if at all, in favor of the West Shore Hudson River Railroad Company; and nothing is shown qualifying the title of the latter company to the property thus sought to be transferred except this mortgage, and the transfer of July 27, 1871, to the New York, West Shore & Chicago Railroad Company, discussed under the last point, and under which the demurrants claim. They are, therefore, in no position to dispute the sufficiency of the lease and transfer of capital stock. There is no force in their argument that, if they "are to be considered as succeeding to the property and rights of the Hudson River West Shore Railroad Company, they can of course question the validity of the mortgage, if its validity could have been questioned by the corporation itself," because the very instruments which make them successors to the property and rights of the Hudson River West Shore Railroad Company also operate to make the mortgage valid. If these rights were passed to the West Shore Hudson River Railroad Company, and thence to demurrants' grantor, they were covered by the mortgage, which was in existence, and operative to cover after-acquired property, before the West Shore Hudson River Railroad Company passed them on.

The demurrer of the defendants the West Shore Railroad Company and the New York Central & Hudson River Railroad Company is overruled, with leave to answer.

CAMPBELL V. CITY OF NEW YORK.

(Circuit Court, S. D. New York. May 22, 1888.)

EQUITY-PLEADING-SUPPLEMENTAL BILL.

Where the complainant in an original bill has, since bringing the suit, parted with his whole interest in the subject-matter, and those for whom he was trustee have transferred their whole interest in the subject-matter to A, and the title to any sum of money which may be recovered in the suit has by these transfers become vested in A., the remedy of A. is by an original bill in the nature of a supplemental bill, and not by a supplemental bill.

In Equity. On demurrer to supplemental bill. pleas to supplemental bill, see 33 Fed. Rep. 795.

For hearing on

James B. Lockwood, (Marcus P. Norton, of counsel,) for complainant. Henry D. Hadlock, for Philbrook.

George Bliss and Sherman M. Rogers, for Green and Murphy.

WALLACE, J. The theory upon which this supplemental bill proceeds is that Campbell, the complainant in the original bill, since bringing the suit, has parted with his whole interest in the subject-matter, and that those for whom Campbell was trustee have transferred their whole interest in the subject-matter to Philbrook, or to Philbrook and Knibbs, and that the title to any sum of money which may be recovered in the suit has by these transfers become vested in Philbrook, or in Philbrook and Knibbs. Upon such a state of facts the remedy of Philbrook is by an original bill in the nature of a supplemental bill, and not by a supplemental bill. This was distinctly stated in the opinion announced upon the hearing of the motion in which Philbrook applied for leave to be made a co-complainant. Although the distinction between supplemental bills and original bills seems to rest upon purely artificial reasons, it is well recognized, and is attended in practice with consequences which af fect the substantial rights of parties. If the cestuis que trust had not transferred all their interest in the subject-matter, and there had been simply a change of trustees by operation at law, or if there had been only a partial alienation of the title of Campbell, a supplemental bill might lie. As it is, the demurrer must be sustained. Mitf. Eq. Pl. 55, 98; 1 Barb. Ch. Pr. 66, 84; Story, Eq. Pl. 349; Tappan v. Smith, 5 Bis. 73. The third ground of objection assigned in the demurrer sufficiently raises the point.

HENRY V. TRAVELERS' Ins. Co.

(Circuit Court, D. Colorado. May 16, 1888.)

1. EQUITY-PRACTICE - BOOKS AND PAPERS - RECORDS OF CORPORATION NOT A PARTY.

The court will not grant a motion to compel the opening of the records of a corporation not a party to the suit, but whose records it is claimed would disclose something of importance to the litigation.

2. SET-OFF AND COUNTER-CLAIM-JUDGMENTS FOR COSTS.

Where A. has judgment for costs against B., and B. has a like judgment in another case against A., one may be equitably set off against the other pro tanto; particularly where one of the parties is insolvent.

In Equity. On motions.

Wolcott & Vaile, for complainant.

J. P. Brockway and Patterson & Thomas, for defendant.

BREWER, J. In Henry v. Insurance Co. are two or three motions which were, partially at least, submitted to me during the vacation. One is a motion to compel the opening of certain records of a corporation not a party to the suit, but whose records it is claimed would disclose something of importance to the litigation. I overruled that motion temporarily during vacation, and after hearing fuller statements of counsel the other day, I am strengthened in the opinion that I then had, not merely by the fact that this is the record of an independent corporation not a party to this suit, but also by the fact of the manner in which this title has passed from one to another, and has finally come to be in the corporation. That motion will remain overruled as heretofore. In reference to the costs, there being an interlocutory decree in favor of complainant for costs up to date, the draft of the decree prepared by each counsel containing the same provision, I accepted that prepared by the complainant, and after making some changes, signed it. It would be an extreme case that would call upon the court to change a decree thus prepared and entered, and I see no reason why it should be changed. The complainant is entitled to the payment of his costs. The second motion in reference to those costs is that there be ordered an equitable set-off of costs adjudged in another case between the same parties. The matter of set-off depends upon purely equitable principles, and I do not see any reason why it is not equitable that there should be such a set-off. If A. has a judgment in his favor against B., and B. has a judgment in his favor against A., there is no wrong in setting off one against the other pro tanto. If each party is solvent, of course it makes no difference, and if one is not, the equitable reasons for the set-off are only stronger. The motion, therefore, in respect to that set-off pro tanto is sustained. The third mo

tion is in reference to some garnishee proceedings. I do not think a judgment for costs can be subjected to such garnishee proceedings, and that motion will be overruled.