In re McIntire

DAYTON, District Judge (after stating the facts as above). This case as presented upon the original hearing before the referee did not, in my judgment, involve much difficulty. It was clearly determinable under sections 7 to 15, inclusive, of chapter 93 of the Code of West Virginia (1899), which expressly create a lien for rent and constitute the procedure for its recovery. Section 11 provides: “The distress may be levied on any goods -of the lessee, or his assignee or under tenant, found on the premises, or which may have been removed therefrom not more than thirty days. If the goods of such lessee, assignee, or under tenant, when carried on the premises áre subject to a lien, which is valid against his creditors, his interest only in such goods shall be liable to such distress. If any lien is created thereon while they are on the leased premises, they shall be liable to distress, but for not more than one year’s rent, whether it shall have accrued before or after the creation of the lien.” The twelfth section provides that a person securing a lien upon goods' after the commencement of a tenancy can only remove them from the premises by paying the rent in arrear and. securing that to accrue to the extent of one year’s.rate as fixed by the lease. In the case of Anderson v. Henry, 45 W. Va. 319, 31 S. E. 998, Judge Brannon has very clearly and ably discussed these provisions, holding that their effect is to give a lien for one year’s rent, whether accrued or not, on tenant’s goods carried on the premises over all liens by deed of trust, mortgage, or otherwise, created after tenant’s term, whether distress warrant therefor has issued or not, and that the fourteenth amendment to the Constitution of the United States [596] does not render them void. With these views I am in entire accord. In this case here the facts presented to the referee at his hearing on August 7, 1905, reduced themselves to these: Depue, the lessee in possession under the lease assigned to him by Biddle, with the assent of the lessors, had this furniture in the leased property, when on January 10, 1905, he gave the deed of trust upon it to secure Clendenning. He was also “carrying it on the premises” on March 8, 1905, when he sold it to Fouse, and it still remained in the hotel property when Fouse sold to Mclntire on March 16, 1905, and took his deed of trust upon it to secure his purchase money. During all this time the lien for one year’s rent either accrued or to accrue under the lease had attached to it in favor of the lessors, the Jacksons. Neither Clendenning, Fouse, nor their trustee, under this section 12 of chapter 93 of the Code of 1899, could have removed such furniture and sold it to satisfy their liens without first having paid the Jacksons the accrued rent and secured to them the payment of an additional sum sufficient to make in all the full amount of one year’s rate as provided by the lease, and, in case such removal had been illegally made, the lessors could have distrained such goods wheresoever found at any time within 30 days after such removal. The claim asserted by the Jacksons for rent was for $2,066.67, less than one year’s rent, and the fact that it was due and unpaid was undisputed. It is very clear that, under such circumstances, the referee could not decree otherwise than in favor of the lessors, the Jacksons, as against the deed of trust creditors, Clendenning and Fouse. But, after he had entered his final order adjudicating the matter this way, Fouse, by petition, asks a review, and for the first time charges substantially that the lessors by their agent, before his purchase of the property, represented to him that Depue had adjusted the rent and upon this representation he was induced to buy. This, if substantiated, would make an altogether different case out of the matter. It cannot be denied that, no matter how clear a lien one may have upon property, if he represents such lien to have been paid or adjusted and thereby induces another to buy the property, he is thereafter estopped from asserting his lien against it. McBane v. Wilson (C. C.) 8 Fed. 734; Schroeder v. Young, 161 U. S. 334, 16 Sup. Ct. 512, 40 L. Ed. 721; N. & W. R. Co. v. Perdue, 40 W. Va. 422, 21 S. E. 755; Stone v. Tyree, 30 W. Va. 687, 5 S. E. 878; Herm. Estop. § 735; 2 Pom. Eq. Jur. § 802. The referee sustained a demurrer to this petition, and therefore we must, in reviewing his action, take, as he was required to do, the allegations of it to be true, and, moreover, construe them most favorably to the petitioner. We must not, however, overlook the fact that proceedings in bankruptcy are wholly equitable in character and governed by the ¿rules of equity practice, where not in conflict with the direct provisions of the act itself. Also, that referees in their hearings within the scope of their power are clothed with the authority of judges, and their orders and decrees are to be reviewed, reversed, or annulled under the same rules and conditions as those governing other courts of equity, subject always to the express provisions of [597] the bankrupt act. The petition here must be held to have been one in the nature of a bill of review. Such bills can be filed for errors in law apparent upon the face of the decree, or because of the discovery of new evidence since hearing, which could not have been discovered by the use of due diligence before such hearing. In case newly discovered evidence is set up, such a bill can only be filed by express leave of the court, and great caution is to be exercised in granting such" leave. The evidence must be relevant, material, and such as would have produced a different result had it been used at the hearing. It must have been unknown to the party at the time of the hearing, and such as by due diligence could not have been known. Hogg’s Eq. Pro. c. 12; Hyman v. Smith, 10 W. Va. 298; S. M. Co. v. Dunbar, 32 W. Va. 335, 9 S. E. 237; Hatcher v. Hatcher, 77 Va. 600; Wethered v. Elliott, 45 W. Va. 436, 32 S. E. 209; Nichols v. Nichols, 8 W. Va. 174; Dunfee v. Childs, 45 W. Va. 155, 30 S. E. 102; Shakers v. Watson, 77 Fed. 512, 23 C. C. A. 263; Jourolmon v. Ewing, 85 Fed. 103, 29 C. C. A. 41; Irwin v. Meyrose (C. C.) 7 Fed. 533. The only possible ground upon which this petition could be maintained for the purpose of securing a review of the decree would be the new facts setting up the estoppel of the Jacksons to assert their rent lien. But these facts cannot possibly be considered now. They were known to Fouse when he filed his original demurrer, answer, and protest to the Jacksons’ claim. There was no possible reason why he should not have set them up and relied on them in that pleading. They were based upon his own knowledge, derived from his own conversation with the landlord’s agent, and he does not attempt to give any reason why he failed to bring them forward in the original hearing. It is very clear to me that this petition does not comply with any of the rules authorizing it to be filed, and that the referee acted rightly in rejecting it upon demurrer. I find no error, therefore, in the two orders of the referee complained of, and they will be, in all respects, affirmed.