716

FEDERALREPORTlm,

vol. 39.

And again at 648, in the same case, the court says: .. "In out opinion such a construction of the constitution leads to the conclusion that no state has the right to lay a tax on interstate commerce in any form whether by way of duties laid on the transportation of the subjects of that commerce, or on the receipts derived from that transportation, or on the occupation or business of carrying it on, and the reason is that such taxation is a burden on that commerce, and amounts to a regulation of it, which belongs solely to congress. " So, under the tax law of the state of 1889, although the tax purports on its ince to be for carrying on the express business within the state, yet, as already shown, the burden of the tax falls upon the interstate business, and amounts to a collection of the tax from that source to a great extent at least. It follows from the views announced that an injunction may issue as prayed for, on complainant executing bond, with sufficient surety in the penalty of $10,000, to satisfy such decree as may be finally rendered against it in the cause.

UNITED STATES V. AMERICAN BELL TEL.

Co. et al.

(Circuit Court, D. Massacltusetis.

EQUITY-PJ,EADING-AMENDMENTS.

September 9, 1889.)

Under Rev. St. U. S. § 954, giving the federal courts power to permit parties to amend pleadings at any time, on such conditions as they may prescribe, a motion by one defendant in equity to withdraw an answer and file the same plea as is filed by its co-defendant. will be granted when not made for the purpose of setting up a merely technical defense, nor after evidence has been taken, and it is probable that it will be more convenient to try the issue raised by the plea first, and where a replication has been Iiled to the co-defendant's plea.

In Equity. On motion for leave to amend. Charles S. Whitman, George A. Jenks, and Owen A. Galvin, for complainant. Chauncey Smith, Elias Merwin, and James J. Storrow, for defendant American Bell Telephone Company. COLT, J . I n this case the defendant company has filed a general answer to the bill, and the defendant Bell has filed a plea and answllr in support thereof. The defendant company now asks leave to withdraw its answer, and to file the same plea and answer in support thereof which has been filed by Bell. By section 954 of the Revised Statutes, the courts of the United States may, at any time, permit either of the parties to amend any defect in the process or pleadings, upon such conditions as they may in their discretion or by rule prescribe. The plenary power of the courts of the United States with respect to amendment of pleadings, under the acts of

UNITED STATES V. AMERICAN BEL.L TEL. CO.

717

congress, is recognized in Eberly v. Moore, 24 How. 147. In Hardin v. Bvyd, 113 U. S. 756, 5 Sup. Ct. Rep. 771, the supreme court states the rule as follows: "In reference to amendments of equity pleadings the courts have found it impracticable to lay down a rule that would cover all cases. This allowance must, at every stage of the cause, rest in the discretion of the court; and that discretion niust depend largely on the special circumstances of each case. It may be said, generally, that in passing upon applications to amend, the ends of justice should never be sacrificed to mere form, or by too rigid an adherence to technical rules of practice. Undoubtedly, great caution should be exer('ised where the application comes after the litigation bas continued for some time, or when the granting- of it would cause serious inconvenience or expense to the opposite side. And an amendment should rarely, if ever, be pt'rmitted where it would materially change the very substance of the case made by the bill, and to which the parties ha ve directed their proofs."
It thus appears that the allowance of amendments of equity pleadings is a question of judicial discretion, depending largely on the special circumstances of each case. The present motion is not open to the objection of introducing a new on a new state of facts, or of changing the substance of the case made by the bill. It is not made for the purpose of setting up a merely technical defense; nor after the litigation has continued, and evidence has been taken; nor does it seem to me that granting it would cause Inconvenience or expense to the other side. Upon this last point it is urged by the defendants that it will be more convenient and less expensive to first try the question of fraud which is raised by the plea, and which may dispose of the case. The counsel for the defendants further say that the general answer was filed 011 behalf of the Bell Company under the misapprehension that the equity rules of this court were the same as prevail in the Massachusetts state court, and that, but for this misapprehension, the same plea and answer in support thereof would have been filed on behalf of the company as was filed by the defendant Bell. Although the question of priority of invention is raised by the bill, the defendants insist that, when this case was before the supreme court on demurrer (128 U. S. 315, 9 Sup. Ct. Rep. 90,) that court first directed its attention to the question whether the bill contained sufficient allegations of fraud, and that the court refused to go a step beyond the position that the government had the power to bring suit to annul a patent in the event that it was obtained by fraud. In view of this opinion of the supreme court it is urged that the issue of fraud should be first tried as to both of the defendants. With the decision of the supreme court before me, I think there are strong equitable grounds for granting this motion. Limiting the case to the question of fraud llJay confine the testimony within comparatively narrow bounds, whereas the question of priority alone involves a laborious and extensive examination. If there is an issue in the case which may dispose of it without going into that elaborate investigation, it seems to me that the discretion of the court should be exercised in favor of such a limitation. Again, so f!tr as the defendant Bell is concerned,· this issue must be

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FEDERAL REPoR'1'ER, vol. 39."

first tried, because the plaintiff has filed a replication to Bell's plea. While it must be admitted that a motion to withdraw an answer and substitute a plea is rare in equity causes, still, taking into consideration all the circumstances as presented in this case, I am of opinion that the justice and convenience of the case will be best promoted by having the issues proceed pari passu as to each defendant, and that, therefore, the motion should be granted. Motion granted.

PARKER v. TOWN Ol!' CONCORD et al.

Oircuit Oourt, N. :D. illinois. July 22, 1889.
EQUITY-ANSWER-DISMISSAL.

Where an answer to a bill in equity completely denies all its equities, and complainant has not met these denials with any proof, nor made an.y issue by replication, the bill will be dismissed.

In Equity. Bill for relief. Bailey &; Sedgwick, for complainant. Bisbee, Ahrens &; Decker, for defendants. BLODGETT, J., (orally.). is a bill filed by the complainant, as Q holder of the bonds of the town of Concord, for relief against the town and the railroad company The allegations are, substantially, that in 1869 the town of Concord voted $25,000 to aid in the construction of the Chicago, Danville & Vincennes Railroad, and subsequently issued bonds in payment of this subscription; that the complai:lant has become the holder of 20 of these bonds for $1,000 each by purchase for value in the market, and that the courts have held these bonds void. The complainant, as such bondholder, now seeks to be subrogated to the place of the railroad company as the payee of the subscription, with the averment that the issue of void bonds did not pay the indebtedness created by the subscription, it being averred that the railroad was completed according to the terms of the subscription, and that, as the complainant now stands in the position by virtue of being the owner in good faith of the bonds from the town, he is entitled to relief against the town by a decree requiring the town to pay him the. amount of the 20 bonds which he holds in satisfaction of the subscription. The case is brought to hearing on bill and answer. The answer denies many of the substantial allegations in the bill, such as the complEition of the railroad according to the terms of the subscription; and the fact that the railroad was located as was required by the terms of the subscription; and generally that the railroad company has failed to perform the conditions upon which the subscription was voted. It seems to me, without considering any other question, that as the answer completely denies the equities of the bill, and the complainant has