The Circuit Court of Appeals for the Eighth Circuit, in the case of United States v. Atchison, Topeka & Santa Fé Railway Co., 163 Fed. 517, held that the duty placed upon the railroads by the act is the same in both instances, and therefore that that which would be deemed a violation in an action to recover for personal injuries is also to be deemed a violation in an action to recover the statutory penalty.

In that case the court followed the decision of the Supreme Court of the United States in the case of St. L., I. M. & S. Ry. v. Taylor, 210 U. S. 281, 28 Sup. Ct. 616, 52 L. Ed. 1061, holding that the duty imposed upon a railroad company by the Safety Appliance Act is absolute and unconditional. Circuit Judge Van Devanter, in discussing this point, said:

"Stripped of matters about which there is no controversy here, the violation charged consisted in hauling a car, in the usual course of transportation, when one of the couplers thereon was broken and inoperative, so that it could not be coupled or uncoupled without the necessity of a man going between the ends of the cars. The trial was to a jury, and the single question presented to us is whether or not the duty of the defendant, in respect of the maintenance of the coupler in an operative condition, was correctly stated in the portion of the court's charge, which reads:

""The act, however, must necessarily have a reasonable construction. These couplings will get out of repair, and it takes time to repair them. It takes time to discover whether or not they are out of repair. It is the duty of the railway companies to use prudence and the ordinary diligence of a business man, keeping in view the purposes of the act, to keep these couplings in repair. * And it is for you to determine in this case whether or not the defendant used reasonable care in ascertaining whether the car was in good repair, and then, again, whether the defendant used reasonable care in putting the coupler in good repair, after it ascertained that it was out of repair. If you find that it did use reasonable care in both instances, then it is not liable, and you should return a verdict in favor of the defendant; otherwise, you should find for the United States.'

"Applying to the evidence the law as so interpreted, the jury returned a verdict for the defendant, which the court declined to disturb upon a motion for a new trial. United States v. Atchison, etc., Ry. Co. (D. C.) 150 Fed. 442. That the interpretation of this law of Congress has been attended with difficulty is attested by many varying opinions in the reported cases, and that there are considerations tending to sustain the construction placed upon it by the district court is attested by the opinion rendered upon the motion for a new trial and by sustaining opinions in other cases, notably St. Louis & S. F. Ry. Co. v. Delk, 158 Fed. 931, 86 C. C. A. 95, but, as we read the opinion of the Supreme Court in the more recent case of St. Louis, Iron Mountain & Southern Railway Co. v. Taylor, 210 U. S. 281, 28 Sup. Ct. 616, 52 L. Ed. 1061 (Neal v. St. Louis, I. M. & S. R. Co., 71 Ark. 445, 78 S. W. 220; St. Louis, I. M. & S. R. Co. v. Neal, 83 Ark. 591, 98 S. W. 959), it is now authoritatively settled that the duty of the railway company in situations where the congressional law is applicable is not that of exercising reasonable care in maintaining the prescribed safety appliance in operative condition, but is absolute. In that case the common-law rules in respect of the exercise of reasonable care by the master and of the nonliability of the master for the negligence of a fellow servant were invoked by the railway company, and were held by the court to be superseded by the statute; it being said in that connection:

"In deciding the questions thus raised, upon which the courts have differed, St. Louis & S. F. Ry. v. Delk, 158 Fed. 931, 86 C. C. A. 95, we need not enter into the wilderness of cases upon the common-law duty of the employer to use reasonable care to furnish his employé reasonably safe tools, machinery, and appliances, or consider when or how far that duty may be performed by delegating it to suitable persons for whose default the employer is not responsible. In the case before us the liability of the defendant does not grow

out of the common-law duty of master to servant. The Congress, not satisfied with the common-law duty and its resulting liability, has prescribed and defined the duty by statute. We have nothing to do but to ascertain and declare the meaning of a few simple words in which the duty is prescribed. It is enacted that "no cars, either loaded or unloaded, shall be used in interstate traffic which do not comply with the standard." There is no escape from the meaning of these words. Explanation cannot clarify them, and ought not to be employed to confuse them or lessen their significance. The obvious purpose of the Legislature was to supplant the qualified duty of the common law with an absolute duty deemed by it more just.'

"While the defective appliance in that case was a drawbar, and not a coupler, and the action was one to recover damages for the death of an employé, and not a penalty, we perceive nothing in these differences which distinguishes that case from this. As respects the nature of the duty placed upon the railway company, section 5, relating to drawbars, is the same as section 2, relating to couplers, and section 6, relating to the penalty, is expressed in terms which embrace every violation of any provision of the preceding sections. Indeed, a survey of the entire statute leaves no room to doubt that all violations thereof are put in the same category, and that whatever properly would be deemed a violation in an action to recover for personal injuries is to be deemed equally a violation in an action to recover a penalty.

"Because, in view of the later decision in the Taylor Case, the instruction before quoted did not embody a correct statement of the law, the judgment is reversed, with a direction to grant a new trial."

Also in the case of Chicago Junction Railway Co. v. William R. King (decided by the Circuit Court of Appeals for the Seventh Circuit at its October term, 1908) 169 Fed. 372, Circuit Judge Baker, who delivered the opinion of the court, in discussing this phase of the question, said:

"Upon the carrier the statute lays the duty of seeing to it that no cars are hauled or used on its line that are not equipped according to the statutory requirements. This direct statutory duty cannot be evaded by assignment or otherwise. Therefore the act of the conductor who had charge of the train in deciding what should be done with the defective car was the act of the defendant. As to the negligence of the engineer, it is immaterial whether it be taken as that of the defendant or of a fellow servant of plaintiff, for defendant cannot be exempted from liability for its own negligence by reason of the concurrence of another's. Chicago, M. & St. P. R. Co. v. Ross, 112 U. S. 377, 5 Sup. Ct. 184, 28 L. Ed. 787; Monmouth, M. & M. Co. v. Erling, 148 Ill. 533, 36 N. E. 117, 39 Am. St. Rep. 187; So. Pac. Co. v. Allen (Tex.) 106 S. W. 443."

Counsel for plaintiff in error are insistent that the provisions of this statute are subject to an exception that lessens the degree of diligence which would otherwise be required at the hands of railroad companies, but a careful examination of the same convinces us that no such exception is contained therein, and while it is urged that the requirements of the statute are unduly severe and unreasonable, even admitting this to be true, the fact would not justify a modification of the statute by judicial decision. The courts do not possess the power to read an exception into a statute so as to modify or change the nature of the same and thus defeat the purposes for which the law was intended.

In the case of United States v. Colorado & N. W. R. R. Co., 157 Fed. 321, 85 C. C. A. 27, 15 L. R. A. (N. S.) 167, the Circuit Court

of Appeals for the Eighth Circuit, in discussing this phase of the question, said:

"Where the Congress makes no exception from the clear and certain declaration of a statute, there is ordinarily a presumption that it intended to make

none.

"By so much the more it is true that where the lawmaking body has made exceptions to the general terms of an act, as in this instance, the presumption is that it intended to make no more. Again, if Congress intended to make this exception, it was a secret intention which the safety appliance acts not only failed to express, but which their terms expressly negatived. It is the intention expressed, or necessarily implied, in the law, and that alone, to which courts may lawfully give effect. They may not assume or presume purposes and intentions that are neither expressed nor implied, and then construe into the law the provisions to accomplish these assumed intentions. A secret intention of the lawmaking body cannot be legally interpreted into a statute which is plain and unambiguous and which does not express or imply it."

The contention that this statute works a hardship applies with equal force to any statute which undertakes to control the affairs of individuals or corporations in this way, but in the light of past experience we are inclined to think that this is the only method by which dangers incident to this kind of employment can be minimized. When we contemplate the vast number of accidents resulting from the operation of railroad trains not properly equipped with safety appliances, we are forced to admit the wisdom and fairness of legislation of this kind. It has been the policy of our lawmakers, both state and national, to grant railroad and other public corporations certain privileges not enjoyed by private individuals; and, while this is a wise policy and has met with general approval, it is likewise proper that due regard should be had for the rights of those employed by such corporations in performing duties that are necessarily dangerous in their character, and it cannot be said to be an unreasonable provision to require railroad companies, enjoying privileges thus conferred upon them, to manage and operate their engines and cars so as to minimize the risk incident to travel and employment.

To sustain the contention of the defendant company as to the proper construction to be placed upon the provisions of this act would be to render the act nugatory, while on the other hand, if we construe it in accordance with the well-established rules in such cases, we afford life and vitality to the law and thus give expression to the legislative will. In other words, if Congress had the power, in the first instance, to legislate so as to regulate the conduct of railroads for the protection of employés and in the interest of the traveling public, then it must be admitted that it has not, in the passage of this law, transcended its limitation, and any construction short of holding the act to be absolute would leave undisturbed the situation as it existed prior to its enactment, and it would be difficult to imagine a state of facts upon which railroads would be liable for a penalty or where an employe would be able to recover in an action instituted to recover damages for injuries incurred on account of failure to perform the duties imposed by the statute. It was the manifest intention of Congress, in the enactment of this statute, to require all common carriers engaged in interstate commerce to keep their cars and engines at all times

equipped with proper safety appliances. The degree of diligence required by the statute is of the highest order, and the duty thus imposed is absolute and unconditional. Therefore any failure on the part of a railroad company to comply with its requirements must necessarily subject the railroad company to the penalty imposed.

It must be admitted that some of the cases relied upon by plaintiff in error are in conflict with the views entertained by this court. However, after due consideration of all the cases relied upon by plaintiff in error, we are of opinion that they are not controlling in this in

stance.

For the reasons hereinbefore stated, the judgment of the court below is affirmed.

HARRILL v. DAVIS et al.

(Circuit Court of Appeals, Eighth Circuit.

No. 2,805.

March 2, 1909.)

1. PARTNERSHIP (§ 41*)-CORPORATIONS (§ 225*)-INDIVIDUAL LIABILITY IN CASE OF FAILURE TO INCORPORATE-GENERAL RULE.

The general rule is that parties who associate themselves together and conduct a business for profit under a name adopted or used by them for that purpose are liable as partners for the debts they incur under that

This general rule governs if the name used be that of a supposed corporation which the associates have attempted but failed to organize according to law.

But a compliance by such associates with the statutes authorizing them to become a corporation exempts them from other individual liability than that prescribed by such laws for debts incurred after they become a corporation authorized to do business as such.

[Ed. Note. For other cases, see Partnership, Cent. Dig. §§ 56, 58; Dec.. Dig. 41; Corporations, Cent. Dig. §§ 74, 864, 865; Dec. Dig. § 225.*] 2 PARTNERSHIP ($ 41*)-CORPORATIONS (§ 30*)-INDIVIDUAL LAABILITY-EXCEPTIONS TO GENERAL RULE.

Two exceptions to the general rule that corporators failing to organize legally are individually liable are: (1) Where such associates procure a charter or file articles of incorporation under a general enabling act, secure thereby the color of a corporation, believe they are such, and use the supposed franchise of their corporation, and third parties deal with them as a corporation, they become a de facto corporation, which exempts them from individual liability to such parties, although there are defects in their incorporation. (2) Projectors of a corporation to be organized who inform third parties that they are contracting for such a corporation and assure them that the obligations incurred will become the obligations of the future corporation may escape individual liability to such third parties for obligations thus incurred for services necessary to effect the corporate organization and for machinery and other property necessary to the commencement of the contemplated business of the corporation, where the corporation is subsequently organized, takes the benefit of such contracts, and assumes the obligations.

[Ed. Note. For other cases, see Partnership, Cent. Dig. §8 56, 58; Dec. Dig. & 41:* Corporations, Cent. Dig. §§ 97-100; Dec. Dig. § 30.*]

3. PARTNERSHIP (§ 44*)-BURDEN OF PROOF ON CLAIMANTS OF EXEMPTION FROM LIABILITY.

When the fact appears that parties associated themselves together and incurred liabilities in the conduct of a business under a certain name, the For other cases see same topic & § NUMBER in Dec. & Am. Digs. 1907 to date, & Rep'r Indexes

legal presumption is that they are governed by the general rule and are liable as partners, and the burden is on them to prove that they are duly incorporated or that they fall under some exception to the general rule. [Ed. Note. For other cases, see Partnership, Cent. Dig. §§ 62, 62%1⁄2; Dec. Dig. § 44.*]

4. CORPORATIONS (§ 221*)-CORPORATION DE FACTO-COLOR OF ORGANIZATION SUCH AS CHARTER OR FILING ARTICLES REQUISITE.

Color of legal organization as a corporation, such as a charter or the filing of articles of incorporation under some law, and user of the supposed corporate franchise in good faith, are indispensable to the existence of a de facto corporation which will exempt from individual liability those who actively conduct it.

Neither the execution of articles which are not filed, nor statements nor beliefs of the promoters that they are a corporation, nor the treatment of themselves by themselves and by those who deal with them as a corporation, nor all these together, will exempt those who actively conduct the business under the assumed name of such a nonexistent corporation from individual liability for the debts they incur.

[Ed. Note. For other cases, see Corporations, Dec. Dig. § 221.*]

5. CORPORATIONS (8 34*)-CORPORATION DE FACTO-ESTOPPEL FROM DENYING EXISTENCE INAPPLICABLE IN ABSENCE OF COLOR OF INCORPORATION.

One who deals with a corporation de facto may be estopped from denying its existence as a corporation de jure.

But no one is estopped by dealing with parties as a corporation who are actively conducting business for profit under an assumed corporate name when they have no charter, have filed no articles of incorporation, and procured no color of legal organization as a corporation, from denying that they constitute a corporation of any kind or from enforcing their individual liability for the debts they incur under such a name.

[Ed. Note. For other cases, see Corporations, Cent. Dig. §§ 84, 91; Dec. Dig. § 34.*]

6. CORPORATIONS (§ 372*)-ULTRA VIRES-CONSTRUCTING AND OPERATING COTTON GIN BEYOND POWERS OF BROKERAGE COMPANY.

A corporation organized for the purpose of “buying, selling, leasing and dealing in lands, securities, bonds, notes, stocks and other negotiable paper and also buying and selling general merchandise" has no corporate power to build and operate cotton gins or to subscribe for stock in and form another corporation for that purpose.

[Ed. Note. For other cases, see Corporations, Dec. Dig. § 372.*]

7. STATUTES (§ 226*)-CONSTRUCTION-ADOPTION ADOPTS INTERPRETATION.

The adoption of a statute previously in force in some other jurisdiction is presumed to be the adoption of the interpretation thereof which had been theretofore placed upon it by the judicial tribunal whose duty it was to construe it.

[Ed. Note.-For other cases, see Statutes, Cent. Dig. §§ 256, 307; Dec. Dig. § 226.*]

8. ELECTION OF REMEDIES (§ 12*)-PURSUIT OF INCONSISTENT MISTAKEN REM-. EDY NO DEFENSE TO TRUE REMEDY.

The fatuous choice of a fancied remedy that never existed, and the futile pursuit of it until the court adjudges that it never had existence, is no defense to an action to enforce an actual remedy inconsistent with that first invoked.

[Ed. Note. For other cases, see Election of Remedies, Cent. Dig. § 15; Dec. Dig. § 12.*]

9. CORPORATIONS (§§ 22, 221*) — PROMOTERS INDIVIDUALLY LIABLE-FACTSCONCLUSIONS.

The four defendants agreed in April or June, 1902, to take specified shares in a $10,000 enterprise for the purpose of building a cotton gin *For other cases see same topic & § NUMBER in Dec. & Am. Digs. 1907 to date, & Rep'r Indexes