Opinion of the Court.

of the mortgagors, as the bank contends was in the contemplation of the mortgagees, it would not be held, as a matter of law, to be absolutely void or fraudulent as to other creditors. Oliver v. Eaton, 7 Michigan, 108, 112; Gay v. Bidwell, 7 Michigan, 519, 523; People v. Bristol, 35 Michigan, 28, 32; Wingler v. Sibley, 35 Michigan, 231; Robinson v. Elliott, 22 Wall. 513, 523. The good faith of such transactions, where they are not void upon their face, is, under the statutes of Michigan, a question of fact for the determination of the jury. Oliver v. Eaton and Gay v. Bidwell." See also Allen v. Massey, 17 Wall. 351. While in the foregoing quotation reference is made only to the statutes of the State, the law is as fully established by repeated decisions of its Supreme Court as by the express language of its statutes. This decision not only gives countenance to the ruling of the trial court in this case, but also warrants an examination of the settled law of the State, as evidenced by the decisions of its highest court. In respect to the latter there can be no doubt. Independently of the ruling in this case, see Torbert v. Hayden, 11 Iowa, 435; Hughes v. Cory, 20 Iowa, 399; Meyer v. Gage, 65 Iowa, 606; and Meyer v. Evans, 66 Iowa, 179. In the first of those cases, it appeared that the mortgagors, with the knowledge of the mortgagee, remained in possession, and sold in the ordinary course of business about a thousand dollars' worth of goods, the proceeds of which were applied to their support and the rent and expenses of the store; and the transaction, having been found to have been in good faith, was sustained, and the mortgage adjudged valid. This decision was in 1861.

In the second case, decided in 1866, the mortgage on its face reserved the right to sell, in the usual course of business, and to add to the stock by the purchase of other goods, with the stipulation that thirty-three per cent of the sale should be applied on the mortgage debt; and in an elaborate opinion by Judge Dillon, the mortgage was sustained.

In the third case, decided in 1885, there was simply a reservation of possession, with the right to sell at retail, and in respect thereto the court summed up the law of the State in these words: "And the uniform holding of this court has

Opinion of the Court.

been that the reservation by the mortgagor of the right to retain possession of the property, and sell it in the ordinary course of business, does not render the mortgage fraudulent in law. See Torbert v. Hayden, 11 Iowa, 435; Hughes v. Cory, 20 Iowa, 399; Clark v. Hyman, 55 Iowa, 14; Sperry v. Etheridge, 63 Iowa, 543; Jaffray v. Greenbaum, 64 Iowa, 492. This holding is based upon the construction given to certain statutes of the State, and it has been adhered to for more than twenty years, and has become a rule of property in the State, and we see no occasion now for departing from the rule that has been thus established."

And in the last case, by the terms of the instrument, there was reserved a right to sell at retail, in the ordinary course of trade; and there was, besides, a parol understanding that the mortgagor should keep up the stock and pay the expenses out of the proceeds of the business; and there was no provision in the mortgage, and no agreement, that the surplus proceeds should be applied on the debt, but by the terms of the mortgage the mortgagee had the right at any time to take possession of the property, and sell the same for the satisfaction of his debt. And it was held that the mortgage was not invalidated thereby, but that its validity depended on the good faith of the parties to the transaction.

From these decisions and others running through a period of thirty years, there can be no doubt as to the settled law of the State; and as to the law established, as was said by the Supreme Court, in Meyer v. Gage, supra, mainly at least from a construction of the state statutes. Can such a settled construction be ignored by this court, and the judgment of the highest court of the State be reversed on error in a matter depending partially at least upon the construction of state statutes? It would be strange, indeed, if this court should adjudge that there was error on the part of the Supreme Court of a State in following its own rulings, uniform and undisturbed for a quarter of a century. The matter is not one of purely general commercial law. While chattel mortgages are instruments of general use, each State has a right to determine for itself under what circumstances they may be executed,

Opinion of the Court.

the extent of the rights conferred thereby, and the conditions of their validity. They are instruments for the transfer of property, and the rules concerning the transfer of property are primarily, at least, a matter of state regulation. We are aware that there is great diversity in the rulings on this question by the courts of the several States; but whatever may be our individual views as to what the law ought to be in respect thereto, there is so much of a local nature entering into chattel mortgages that this court will accept the settled law of each State as decisive in respect to any case arising therein. Chicago Union Bank v. Kansas City Bank, 136 U. S. 223. Indeed, if this were an open question, we could not be blind to the fact that the tendency of this commercial age is towards increased facilities in the transfer of property, and to uphold such transfers so far as they are made in good faith; and it is at least worthy of thought, whether the rulings made by the Supreme Court of Iowa do not tend to make chattel mortgages more valuable for commercial purposes, without endangering the rights of unsecured creditors. The law now generally requires a record of all such instruments, and that, like the recording of a real estate mortgage, gives notice to all parties interested of the fact and extent of incumbrances. Why should a transaction like this be condemned, if made in good faith and to secure an honest debt? The owner of a stock of goods may make an absolute sale of them to his creditor, in payment of a debt. If an absolute, why not a conditional, sale, with such conditions as he and his creditor may agree upon? As between the parties no court would question this right, or refuse to enforce the conditions. The interests of the general public are not prejudiced by any such transaction between debtor and creditor. Indeed, they are rather promoted by any arrangement under which the mortgagor can continue in business, for in ninety-nine cases out of a hundred the taking of possession by a creditor results in closing the business, and turning the debtor out of employment. The only parties who can claim to be injuriously affected are unsecured creditors. But they are notified by the record of the exact relations between the mortgagor and mortgagee;

Syllabus.

and surely subsequent creditors have no right to complain if they deal with the mortgagor with full knowledge of such relations. Existing creditors may of course challenge the good faith of the transaction, but if they cannot disturb an absolute sale when made in good faith, why should they be permitted to challenge a conditional sale if made in like good faith? The fact that fraudulent relations are possible, is hardly a sufficient reason for denouncing transactions which are not fraudulent. So, if the question were open, or a new one, unaffected by any settled law of the State, we incline to the opinion that the question is not one of law, so much as it is one of fact and good faith, and that the decision of the Supreme Court of Iowa rests on sound principles. Jewell v. Knight, 123 U. S. 426; Smith v. Craft, 123 U. S. 436. Reference may also be made to the opinion of Mr. Justice Bradley, of this court, holding the Circuit Court in the Western District of Texas, Barron v. Morris, 14 Nat. Bank. Reg. 371, and the opinion of Mr. Justice Strong in the Circuit Court in New Jersey, in Miller v. Jones, 15 Nat. Bank. Reg. 150.

We see no error in the decision of the Supreme Court of Iowa, and it is Affirmed.

UNITED STATES v. BREWER.

CERTIFICATE OF DIVISION OF OPINION FROM THE CIRCUIT COURT

QF THE UNITED STATES FOR THE WESTERN DISTRICT OF

TENNESSEE.

No. 1178. Argued and submitted March 13, 1891.- Decided March 23, 1891.

Sections 1067, 1068 and 1070 of the Code of Tennessee of 1884, by Milliken & Vertrees do not require that, after an election, the ballot-box shall be opened at the place where the election was held, and the names of the persons appearing in each ballot be read aloud at that place, and the ballot-box not be removed from that place before the votes are counted, so as to make an indictment good, under § 5515 of the Revised Statutes of the United States, relating to an election at which a Representative or Delegate in Congress is voted for, which alleges, as a neglect or refusal to perform a duty, required of the officer of an election, by a law

Opinion of the Court.

of a State, and as a violation of a duty imposed by such law, a failure to open the ballot-box at that place, and a failure to read aloud such names at that place, and the removing of the ballot-box from that place before the votes were counted, no fraud being averred in the indictment, and no intent to affect the election or its result, and there being no allegation that the election or its result was affected.

Two questions in a certificate of division in a criminal case were not answered, because they were too general, one being whether a demurrer to an indictment ought to be sustained, and the other being whether the matters alleged in the indictment constituted an offence under the statute of the United States.

A question was not answered, because the answers to other questions disposed of the case.

THE case is stated in the opinion.

Mr. Solicitor General for plaintiff. Mr. Attorney General was on the brief.

Mr. Julius A. Taylor for defendants submitted on his brief. MR. JUSTICE BLATCHFORD delivered the opinion of the court.

This is an indictment against three persons, found in the Circuit Court of the United States for the Western District of Tennessee, under section 5515 of the Revised Statutes.

That section, with its punctuation, as published in the second edition of the Revised Statutes, is as follows: "SEC. 5515. Every officer of an election at which any Representative or Delegate in Congress is voted for, whether such officer of election be appointed or created by or under any law or authority of the United States, or by or under any State, territorial, district or municipal law or authority, who neglects or refuses to perform any duty in regard to such election required of him by any law of the United States, or of any State or Territory thereof; or who violates any duty so imposed; or who knowingly does any acts thereby unauthorized, with intent to affect any such election, or the result thereof; or who fraudulently makes any false certificate of the result of such election in regard to such Representative or Delegate; or who withholds, conceals or destroys any certificate of record so