termine the sufficiency of the fund and the proper proportional payment, if it was insufficient for payment in full. Referring to such certificates, the court, in the case of Turner v. Peoria & Springfield Railroad Company, 95 Ill. 134, 35 Am. Rep. 144, said:

"It usually appears on the face of such instruments by what authority they were issued, and for what specific purpose. Holders thereof will always be chargeable with notice of these facts. Considerations of the highest concern, to all parties interested in the trust property make it imperative that the court that charges the fund, through its appointed officer, should have the most vigilant care that the property is not improvidently wasted. All persons dealing in such securities must know that payment can only be coerced by application to the court having the control of the trust property for an order upon its acting officer."

The respondent, if the money had not been paid to it by the receiver wrongfully and without authority, could have coerced payment only by petitioning the court having control of the fund to direct its receiver to make the payment. It had no right to demand a determination of its right to payment in a plenary suit. Its position is in no way improved by the wrongful payment to it. Hence the respondent cannot complain of the jurisdiction of the bankruptcy court to order it restored upon condition that petitioner shows that there was no existing indebtedness to the respondent when it was paid, and to determine for itself in a summary proceeding the issue as to the existence of such indebtedness, as it would have had exclusive jurisdiction to do if no wrongful payment had been made. This is what the Circuit Court of Appeals determined, since it directed the remanding of the cause, with instructions "that it be referred to the special master to restate the account between the bank and the receiver in conformity with these views," and not that a plenary suit be instituted by the receiver against the bank to recover the amount so paid.

The petition prays for a rule upon the respondent to show cause why the money should not be restored to the fund by the respondent. This has the effect of bringing the respondent into court. An answer by the respondent that the fund in the custody of the court was indebted to the respondent in a sum equal to or in excess of the amount paid to it by the former receiver will present the issue as defined by the Circuit Court of Appeals. A reference to the special master to state the account between the receiver and the respondent as to such indebtedness will provide the method indicated by the Circuit Court of Appeals to determine this issue.

No order will be made directing the money to be repaid until there has been a determination of the amount, if any, that was due from the receiver to the respondent when the wrongful payment was made. If the parties agree that the issue can be more conveniently determined by the court without a reference, upon testimony now in the record, the matter may be submitted to the court for decision.

1. CORPORATIONS (§ 434*)—TITLE TO REALTY-AUTHORITY TO ACQUIRE. Without express statutory authority, a Massachusetts corporation may acquire title to real estate.

[Ed. Note. For other cases, see Corporations, Cent. Dig. § 1765; Dec. Dig. § 434.*]

2. CORPORATIONS (§ 436*)—REAL ESTATE-MODE OF ACQUIRING-DEVISE-STAT

UTES.

St. Mass. 1856, c. 215, § 4, provided that educational, charitable, and religious corporations might hold real and personal property to an amount not exceeding $200,000. This amount was increased to $500,000 by St. Mass. 1874, c. 375, § 7, which authorized such corporations to hold real and personal property of that value, and to lease, purchase, or erect suitable buildings for their accommodation, to be devoted to the purposes and objects thereof. Held, that such statutes are to be construed as limiting the amount, otherwise unlimited, of real and personal property which may be held by a given corporation, and hence an art museum had authority to take and hold real property by devise.

[Ed. Note. For other cases, see Corporations, Cent. Dig. § 1772; Dec. Dig. 436.*]

Writ of entry by Benjamin W. Hubbard against the Worcester Art Museum. Judgment for defendant.

Charles A. Snow and Joseph H. Knight, for plaintiff.

Ropes, Gray & Gorham and T. Hovey Gage, for defendant.

LOWELL, Circuit Judge. Stephen Salisbury died in 1905, and devised the real estate here in question to the Worcester Art Museum, a corporation established in 1896 under Pub. St. Mass. c. 115. At the death of Mr. Salisbury the Museum held about $700,000 of property, real and personal. The real estate devised by Mr. Salisbury to the Art Museum was valued at about $1,200,000. More than $1,800,000 of personal property passed to the Museum under his will. The present action is a writ of entry, brought by one of Mr. Salisbury's heirs and next of kin. It was heard upon an agreed statement of facts. This devise was before the Supreme Court of Massachusetts in Hubbard v. Worcester Art Museum, 194 Mass. 280, 80 N. E. 490, 9 L. R. A. (N. S.) 689.

The demandant's contention is substantially as follows: Without express statutory authority, no corporation in Massachusetts can acquire title to real estate. By Rev. St. 1836, c. 44, § 6, corporations generally were empowered to "hold lands to an amount authorized by law." Whatever right corporations may have had to acquire and hold personal property, no corporation could, in the absence of specific statutory authority, acquire title to real estate. St. Mass. 1856, c. 215, § 4, the earliest statute which dealt with general incorporation for educational, charitable, and religious purposes, provided that:

*For other cases see same topic & § NUMBER in Dec. & Am. Digs. 1907 to date, & Rep'r Indexes

"Such corporations may hold real and personal estate, necessary for the purposes of said organization, to an amount not exceeding two hundred thousand dollars."

This act also gave no authority to any corporation to acquire title to real estate by any conveyance whatsoever. No authority was subsequently derived from St. 1857, c. 56, Gen. St. 1860, c. 32, or St. 1869, c. 276. St. 1874, c. 375, § 7, provided that:

"Such corporations may hold real and personal estate, and may lease, purchase or erect suitable buildings for their accommodation, to an amount not exceeding five hundred thousand dollars, to be devoted to the purposes and objects set forth in their agreement of association, and they may receive and hold in trust, or otherwise, funds received by gift or bequest to be by them devoted to such purposes."

By this statute the demandant admits that a charitable corporation, not specifically authorized thereto, might take title to real estate by conveyance inter vivos, but contends that it could not take title by devise. His contention is that the word "gift" is applicable only to a conveyance inter vivos, and the word "bequest" to a conveyance by will of personal property. The demandant contends that, for the purposes of this suit, the law was not affected by Pub. St. c. 115, § 7, by St. 1897, c. 97, and by Rev. Laws, c. 125, § 2. The demandant therefore contends that the tenant was in 1905 without corporate authority to take title to any real estate by devise, however small the value thereof might be. He further contends that the point decided by Hubbard v. Worcester Art Museum was this: The petitioners there could not be heard to maintain that the Museum was limited in its holdings of property by the amount set out in the General Laws. The demandant contends that the question here raised, viz., that the tenant can take title to no real estate by devise, is raised in this suit for the first time. It seems that the decision made in Hubbard v. Worcester Art Museum could not have been made if the demandant's contention in the case at bar is sound. In other words, the tenant's right here contested was there passed upon and upheld, although the argument here made against it was not urged or considered. But it is not necessary in the case at bar to determine if the matter be res judicata. The demandant's contention is wholly opposed to the statutes of the commonwealth and to its law as established by its authoritative decisions.

In Hubbard v. Worcester Art Museum, the court said, at page 285 of 194 Mass., at page 492 of 80 N. E. (9 L. R. A. [N. S.] 689):

"We start with the inherent right already referred to of every corporation to take and hold property at common law by virtue of the act of its creation. This right is recognized in our statutes by implication without express mention. Rev. Laws, c. 109, §§ 4, 6."

If the meaning of the provision of the Revised Statutes above quoted had been that which the demandant suggests, it would have been selfcontradictory. How could a corporation "hold" real estate, if it was forbidden to acquire title thereto? That the right to hold includes some right to acquire is plain. See Rev. St. 1836, c. 36, § 15. And the language of Rev. St. 1836, c. 44, § 6, is that employed in many other statutes, as appears from the references made in the demandant's

brief. The demandant's first contention therefore fails. Without express statutory authority a corporation may acquire title to real estate. In the case above cited, the Supreme Court said:

"Some judges, in holding that such titles cannot be taken under further wills, endeavor to found a distinction upon the executed character of a title by grant, and suggest that a devise or bequest is executory. It seems to us that there is no good reason for the distinction. When a will is proved and allowed, it takes effect immediately to pass all property affected by it. The provision in the law against large holdings by corporations has no relation to the probate of the will. The act of the testator in executing the will is confirmed and given effect as a complete and executed disposition of the property, by the allowance of the will. In this respect a recorded will does not materially differ from a delivered deed. The heirs at law are bound by one as well as by the other." Page 287 of 194 Mass., page 493 of 80 N. E. (9 L. R. A. [N. S.] 689).

It follows, therefore, that the charitable corporations of Massachusetts might always acquire title to real estate by devise, except so far as they were limited by statute. This was the construction put upon the charter of Harvard College granted in 1650, which empowered the corporation to

"purchase and acquire to themselves, or take and receive upon free gift and donation, any lands, tenements, or hereditaments, within this jurisdiction of the Massachusetts Bay, not exceeding the value of five hundred pounds per annum."

There is here no mention of taking or acquiring title to real estate by devise, yet the power of the corporation to take real estate in this manner was not questioned. Most of the statutes above cited are not to be taken to enlarge the authority of corporations to acquire or hold real estate by conferring upon them authority otherwise nonexistent. Those statutes are to be taken as limiting the amount, otherwise unlimited, of property, real and personal, which may be held by any given corporation. The demandant's contention, therefore, fails altogether. The tenant has corporate authority to take title to the real estate in question by devise, and that authority has been limited only as to the amount fixed by statute. The statute limiting the amount of property that could be held by the corporation (Rev. Laws, c. 125, § 7) could not be taken advantage of by the demandant, but only by the state. Brigham v. Brigham Hospital, 134 Fed. 513, 67 C. C. A. 393. There must be judgment for the tenant.

The course of reasoning above set out and the decision here rendered are not to be taken to decide, or even to suggest, that the demandant's claim of title does not fail also by reason of the other objections made to it by the tenant. The result here reached is in accord with that reached by Judge Colt in Home for Destitute Children v. Peter Bent Brigham Hospital, decided December 29, 1909 (memorandum), although in that case the learned judge did not state his reasons at length.

Judgment for the tenant.

In re MILLS.

(District Court, E. D. New York. June 20, 1910.)

1. BANKRUPTCY (§ 21*)—JURISDICTION—WAIVER.

Where, in a proceeding in bankruptcy against stockholders of a corporation to compel the delivery of their stock to the bankrupt's trustee, on the theory that an exchange of property for the stock by the bankrupt in the first instance was fraudulent, the stockholders, by answering to the merits, waived an objection to the jurisdiction of the bankruptcy court to determine the issue of title to the stock.

[Ed. Note. For other cases, see Bankruptcy, Dec. Dig. § 21.*]

2 BANKRUPTCY (§ 250*)—ASSETS-TITLE TO CORPORATE STOCK-DETERMINA

TION.

Where more than four months had elapsed between the date of issuing stock of a corporation and that of filing a petition in bankruptcy against M., who organized the corporation and transferred his property in exchange for stock, a part of which he had transferred to others, and in proceedings against such stockholders to recover the stock for the benefit of his estate in bankruptcy, on the theory that the transfer was originally void as to his creditors, it appeared that one of the alleged owners was an infant and that various other transactions and events were involved in determining the title of the stockholders, the matter should be determined in a plenary suit by the trustee, and not in a summary proceeding in bankruptcy.

[Ed. Note. For other cases, see Bankruptcy, Dec. Dig. § 250.*]

In the Matter of Clifford D. Mills, bankrupt. Application of petitioning creditors, directed to various stockholders of a corporation formed by the bankrupt, asking that the stock be turned over to the trustee in bankruptcy as the property of the bankrupt's estate, on the theory that the original transfer by the bankrupt of his property to the corporation in exchange for stock was fraudulent ab initio. Application denied, with leave to trustee to bring a plenary action for such relief.

Lesser Bros. for trustee.

Wingate & Cullen, for People's Trust Company.

Pitney, Hardin & Skinner, for C. D. Mills Baking Co. and others. William W. Butcher, in pro. per.

Coombs & Wilson, for bankrupt.

CHATFIELD, District Judge. The petitioning creditors previously made application to this court to have certain property, formerly belonging to the bankrupt, but transferred by him to the C. D. Mills Baking Company, a New Jersey corporation, at the time of its organization, turned over to the trustee in bankruptcy as a part of the bankrupt's estate. This motion was denied; the record in the case showing that the property had been in fact transferred to the corporation as a consideration in kind for the capital stock issued by the corporation upon the subscriptions of the original stockholders, and that the greater portion of the stock was taken by Mr. Mills, or disposed of at his direction; the remaining few shares of stock being issued to the attorney for his services in connection with the organization.

For other cases see same topic & § NUMBER in Dec. & Am. Digs. 1907 to date, & Rep'r Indexes