"This act shall not affect the allowance to bankrupts of the exemptions which are prescribed by the state laws in force at the time of the filing of the petition in the state wherein they have had their domicile for the six months or the greater portion thereof immediately preceding the filing of the petition." This section establishes the rule of exemption in the most absolute and unqualified terms, and that rule is the state law. The phrase, "this act shall not," is the exact legal equivalent of the expression, "nothing contained in this act shall." This rule of exemption, therefore, pervades the whole act, and is to be read into every other section and provision of the act. If congress had intended to diminish or lessen the state exemptions in any case, and particularly if it had intended to subject to the payment of the bankrupt's debts his policies of life insurance which were exempt under the state law, that intention would undoubtedly have found expression in clear and unmistakable language in section 6. That was the appropriate place for limiting or qualifying the state exemptions, if it was to be done at all. "If a general provision is merely to be negatived in some particular, the negative should be expressed in immediate contact with the general words." Bouv. Law Dict. tit. "Proviso." Additional exemptions or benefits not granted to the debtors by the state laws might be provided for, in the proper connection, anywhere in the act, as was done by this proviso in relation to policies of life insurance in states which do not exempt them, as we shall presently see. In construing the proviso to section 70, not only the whole of that section, but the whole act, must be considered. That section reads as follows:

"The trustee of the estate of a bankrupt, upon his appointment and qualification, and his successor or successors, if he shall bave one or more, upon his or their appointment and qualification, shall in turn be vested by operation of law with the title of the bankrupt, as of the date he was adjudged a bankrupt, except in so far as it is to property which is exempt, to all (1) documents relating to his property; (2) interests in patents, patent rights, copyrights and trade-marks; (3) powers which he might have exercised for his own benefit, but not those which he might have exercised for some other person; (4) property transferred by him in fraud of his creditors; (5) property which prior to the filing of the petition he could by any means have transferred or which might have been levied upon and sold under judicial process against him: provided, that when any bankrupt shall have any insurance policy which has a cash surrender value payable to himself, his estate, or personal representatives, he may within thirty days after the cash surrender value has been ascertained and stated to the trustee by the company issuing the same, pay or secure to the trustee the sum so ascertained and stated, and continue to hold, own, and carry such policy free from the claims of the creditors participating in the distribution of his estate under the bankruptcy proceedings, otherwise the policy shall pass to the trustee as assets; and (6) rights of action arising upon contracts or from the unlawful taking or detention of, or injury to, his property."

The only right or title the trustee has to any of the bankrupt's property is acquired under this section. It vests the title of the property in the trustee, "except in so far as it is to property which is exempt." How is it to be known what "is exempt"? There is but one source of information on that subject, and that is the state law adopted by section 6, and the legal effect of this exception is precisely the same as if it read, "except property which is exempt under the state law." This exception must be read into every other

44 C.C.A.-19

clause and provision of the section. The fifth clause of this section shows conclusively that the construction of the proviso contended for by the trustee is wholly inadmissible. By the plain language of this clause of this section, the trustee is invested with the title to all the bankrupt's "property which prior to the filing of the petition he could by any means have transferred.

Now, the bankrupt could have transferred every particle of property he owned prior to the filing of the petition, and why does not the trustee set up a claim to all of it under this clause? Because it is felt that if such a claim was made it must fail, for the reason that it would be perceived at once that to grant it would completely nullify section 6 and all exemptions under state laws, leaving the bankrupt without any exemption whatever. But there is just as much reason for the trustee claiming under this clause all the property exempt under the state law as there is for claiming a part of it. The difference is one of degree only. It is obvious that section 6 must be read into this clause, if that section is to have any effect at all, and the bankrupt to be allowed any exemptions. But the clause of the fifth paragraph immediately preceding the proviso, and to which the proviso, according to the accepted rule for the construction of provisos, must be referred, removes all doubt as to what is meant by the proviso. In connection it reads: "The trustee shall be vested by

operation of law with the title of the bankrupt to all property which might have been levied upon and sold under judicial process: provided, that when any bankrupt shall have any insurance policy which has a cash surrender value," etc. What kind of an insurance policy is here meant? Plainly and obviously an insurance policy "which might have been levied upon and sold under judicial process," and as to such policies the proviso makes a provision by which the bankrupt may retain his policy by paying its cash surrender value, and thus retain the benefit of the low rate of premium obtained when he was younger, and which could not be obtained on a new policy. Moreover, the proviso is to be read in the light of section 6, and made to harmonize with it and the other provisions of section 70, and, giving due effect and operation to this rule of construction, the proviso means precisely what it would if it read, "provided, that when any bankrupt shall have any insurance policy not exempt." The italicized words or their equivalent are necessarily implied from the other provisions of this section as well as from the sweeping provisions of section 6, and what is implied in a statute is as much a part of it as what is expressed. U. S. v. Babbitt, 1 Black, 61, 17 L. Ed. 94; Gelpcke v. City of Dubuque, 1 Wall. 221, 17 L. Ed. 519; Wilson Co. v. Third Nat. Bank, 103 U. S. 770, 26 L. Ed. 488; Thurber v. Miller, 32 U. S. App. 209, 14 C. C. A. 432, 67 Fed. 371. This construction gives effect to every provision of the act, and renders them harmonious.

It has always been the policy of congress to exempt to debtors and bankrupts the property exempt to them by the state law. From the organization of the federal courts under the judiciary act of 1789, the law has been that creditors suing in those courts could not subject to execution property of their debtor exempt to him by the law

of the state. Judiciary Act 1789 (1 Stat. 93, c. 21); Wayman v. Southard, 10 Wheat. 1, 32, 6 L. Ed. 253; Lamaster v. Keeler, 123 U. S. 376, 8 Sup. Ct. 197, 31 L. Ed. 238; Dartmouth Sav. Bank v. Bates (C. C.) 44 Fed. 546. Confessedly, the creditors, who through the trustee are now seeking to subject these policies to the payment of their debts, could not have subjected them to the payment of their debts by execution or other legal process issuing either from the state or the federal courts. The same rule has obtained under the bankrupt acts, which have sometimes increased the exemptions, notably so under the act of 1867 (section 5045, Rev. St.), but have never lessened or diminished them. An intention on the part of congress to violate or abolish this wise and uniform rule observed from the creation of our federal system should be made to appear by clear and unmistakable language. It will not be presumed from a doubtful or ambiguous provision fairly susceptible of any other construction. If congress was going to attack the state exemptions and lessen or diminish them in any degree, the exemption of life insurance policies would be the very last exemption to be attacked. They are very generally esteemed the best and safest means by which a man of limited means, or one dependent on his daily earnings for his support, can make provision to preserve his family from suffering and want after his death. This is the view taken of life insurance policies by the supreme court of the United States. In the case of Bank v. Hume, 128 U. S. 195, 211, 9 Sup. Ct. 41, 46, 32 L. Ed. 370, 377, Chief Justice Fuller, delivering the unanimous judgment of the court, said:

"This argument in the interest of creditors concedes that the debtor may rightfully preserve his family from suffering and want. It seems to us that the same public policy which justifies this, and recognizes the support of wife and children as a positive obligation in law as well as morals, should be extended to protect them from destitution after the debtor's death, by permitting him, not to accumulate a fund as a permanent provision, but to devote a moderate portion of his earnings to keep on foot a security for support already, or which could thereby be lawfully obtained, at least to the extent of requiring that, under such circumstances, the fraudulent intent of both parties to the transaction should be made out."

Instead, therefore, of nullifying the fundamental and basic rule of exemption established by section 6, and curtailing the exemption under the state law, the proviso in question was intended to and does give the bankrupt a right which, in states whose laws do not exempt policies of life insurance, he would not have without it. The proviso is operative in those states only whose laws do not exempt policies of insurance, and has no application in states whose laws do exempt them. This construction removes all seeming conflict or inconsistency between section 6 and the proviso of section 70, and gives that effect to each which congress plainly intended they should have.

The judgment of the district court is reversed, and the cause remanded, with instructions to that court to set aside the referee's report, and enter judgment in favor of the bankrupts for the policies of insurance claimed by them, respectively.

(104 Fed. 988.)

STUBBS v. UNITED STATES.

(Circuit Court of Appeals, Eighth Circuit. November 14, 1900.)

No. 1,328.

PUBLIC LANDS-PROSECUTION FOR CUTTING TIMBER-INSTRUCTION BASED ON MISTAKE AS TO LAW IN FORCE.

Defendant was prosecuted by information charging him with cutting timber on nonmineral public lands situated in Colorado. The court tried the case upon the theory that the information was based on section 4 of Act June 3, 1878 (20 Stat. c. 151), which prohibits the cutting of timber for sale or export upon any of the public lands in certain designated states and territories, and instructed the jury that under the evidence it was immaterial whether the lands from which the cutting was done were mineral or nonmineral. Such statute in fact is not applicable to the state of Colorado, but under Act June 3, 1878 (20 Stat. c. 150), authorizing citizens and bona fide residents to cut timber for certain purposes from mineral lands in accordance with prescribed regulations, which is in force in that state, defendant was entitled to show as a defense that his cutting was in accordance with such act and the regulations made thereunder, and some evidence was introduced tending to sustain such defense. Held, that the court's instruction, having been based on a mistaken view of the law applicable to the case, and not upon the evidence, was erroneous, and required a reversal of the judgment, where no question as to the sufficiency of the evidence to warrant the submission of the issue to the jury was made by either party, and the record did not show that all the evidence was contained therein.

Sanborn, Circuit Judge, dissenting.

In Error to the District Court of the United States for the District of Colorado.

Reese McCloskey, Charles Hartzell, and George P. Steele, for plaintiff in error.

Greeley W. Whitford, for defendant in error.

Before CALDWELL, SANBORN, and THAYER, Circuit Judges.

CALDWELL, Circuit Judge. The United States district attor ney, by leave of the court, filed a criminal information against Frank W. Stubbs, the plaintiff in error, and others, for cutting timber on nonmineral public lands. The defendant Stubbs was convicted, and brought the case into this court by writ of error. In its charge the court said to the jury:

"I failed to instruct you that under the evidence in this case it is not important whether this land be mineral or nonmineral. If the defendant is guilty in one case, he is guilty in the other. If innocent in the one, he is innocent in the other. So you need not consider the mineral character of this land, as affecting the question."

Due exception was taken to this charge, and this is the only assignment of error we need consider.

This prosecution was in the state of Colorado, and the law relating to cutting timber on the public lands is exceptional in that and some other mining states. By the act of June 3, 1878, entitled "An act authorizing the citizens of Colorado, Nevada and the territories to

fell and remove timber on the public domain for mining and domestic purposes" (20 Stat. 88, c. 150, § 1), it is provided:

"That all citizens of the United States and other persons, bona fide residents of the state of Colorado, or Nevada, or either of the territories of New Mexico, Arizona, Utah, Wyoming, Dakota, Idaho, or Montana, and all other mineral districts of the United States, shall be, and are hereby, authorized and permitted to fell and remove, for building, agricultural, mining, or other domestic purposes, any timber or other trees growing or being on the public lands, said lands being mineral, and not subject to entry under existing laws of the United States, except for mineral entry, in either of said states, territories, or districts of which such citizens or persons may be at the time bona fide residents, subject to such rules and regulations as the secretary of the interior may prescribe for the protection of the timber and of the undergrowth growing upon such lands, and for other purposes."

The act of March 3, 1891 (26 Stat. 1093, c. 559), provides that:

"In the states of Colorado, Montana, Idaho, North Dakota and South Dakota, Wyoming and the district of Alaska, and the gold and silver regions of Nevada, and the territory of Utah in any criminal prosecution or civil action by the United States for a trespass on such public timber lands or to recover timber or lumber cut thereon it shall be a defense if the defendant shall show that the said timber was so cut or removed from the timber lands for use in such state or territory by a resident thereof for agricultural, mining, manufacturing, or domestic purposes under rules and regulations made and prescribed by the secretary of the interior and has not been transported out of the same. And it is expressly provided that "this act shall not operate to repeal the act of June 3, 1878, providing for the cutting of timber on mineral lands."

It is a curious circumstance that this act was, in substance, re-enacted the same day in another act, entitled "An act to repeal timber culture laws and for other purposes" (26 Stat. 1095, c. 561, § 8).

There was evidence introduced tending to show that the timber the defendant was charged with cutting was cut on mineral lands. The prosecuting officer of the government, who filed the information, evidently supposed the act allowing timber to be cut on the public mineral lands was in force and applicable to this case, or he would not have alleged in his information, as he did, that the lands from which the timber was cut were nonmineral. Such an allegation would be surplusage in an information under section 2461 of the Revised Statutes.

The charge of the court makes no reference to the act of June 3, 1878, or to the regulations of the secretary of the interior thereunder; nor does it make any reference to the act of March 3, 1891, and the regulations of the secretary of the interior thereunder. It is not suggested here, and was not in the lower court, that the timber was cut in violation of the rules and regulations prescribed by the secretary of the interior under the acts mentioned, or either of them. The case seems to have been tried upon the assumption that section 4 of the act of June 3, 1878 (20 Stat. 90, c. 151), was, in the language of counsel for the government, "made applicable to the state of Colorado by section 8 of the act of March 3, 1891" (26 Stat. 1097, c. 561). But this is an error. The operation of section 4 of the act of June 3, 1878, entitled "An act for the sale of timber lands in the states of California, Oregon, Nevada, and in Washington Territory" (20