In re Pierce, Butler & Pierce Mfg. Co.

HOUGH, Circuit Judge (after stating the facts as above). [1] As orders in bankruptcy such as this are subject to our revision only in respect of law, it is necessary to ascertain with precision the facts as found in the court below. [816] [2, 3] The special master stated the good faith of the petitioner as a conclusion of law, instead of making it a finding of fact; his report in its form, and separate headings of fact findings and legal conclusions, follows the usual practice of this state. -This method of statement cannot change the inherent nature of what is found, and we therefore inquire whether the good faith of petitioner in doing what it did is a fact, and the ascertainment thereof a finding of fact. Good faith is a state of mind, an attribute of character. It exists; it is in being; yet its existence or being is necessarily discovered only by inference. But such inferential ascertainment is consistent with an existence not in the least derived from or depending on the law. Therefore good faith or bad faith is a fact to be ascertained by the triers of fact — in this case, the master or District Judge; in most instances the jury. As was well said in Nolan v. N. Y., etc., R. R., 70 Conn. 159, 39 Atl. 115, 43 L. R. A. 305, the inferences produced by weighing evidence and the credit of witnesses, are adjudicated, facts, and can be retried only by an appellate court having jurisdiction in the trial of such facts. Similarly an emotion is a fact, and so is the mental result of emotion or desire — thus knowledge, intent, or willfulness are facts. Barr v. Chicago, etc., R. R., 10 Ind. App. 433, 37 N. E. 814. [4] It follows that as the District Judge did not reverse or modify the master’s finding of good faith, and it is not without evidence to support it, we are bound to assume it in considering this petition. [5-7] The legal question remaining is whether under the circumstances stated the petitioner was lawfully entitled to select for the trustee’s advertisement that part of its paper which gave widest publicity to an unusual sale, or was bound to put it where statutory notices were inserted. It may be noted here that the finding of good faith renders superfluous any discussion of the inference possible from the higher cost of doing what was done. Where a contract' for sale, either executed or executory, contains no specific agreement as to price the law supplies a reasonable one (Acebal v. Levy, 10 Bing. 376; Hoadley v. McLaine, 10 Bing. 482), and this contract was for a sale of space. Assumpsit lay for such reasonable price (Jenkins v. Richardson, 6 J. J. Marsh. [Ky.] 441, 22 Am. Dec. 82); i. e., there was an implied promise to pay for what the purchaser obtained ; and this trustee obtained a better article than would have been his, had the advertisement appeared where he now says he wanted it. Though market value and reasonable value are not always the same (Lovejoy v. Michels, 88 Mich. 29, 49 N. W. 901, 13 L. R. A. 770), it is found that petitioner’s price in this case was both. If, then, the Tribune acted in good faith, and sold its space at a fair market price, it is difficult to see why it should not be paid. The reason deemed sufficient below is that, as a matter of law, it was the duty of petitioner to insert “legal notices in a pending proceeding in the bankruptcy court” in “classified” advertising — that being the place for “that class and kind of work.” This presupposes that the newspaper manager in Chicago was familiar with what would be “legal notices” in the Northern district of New York, concerning which there is no proof, and certainly the trustee furnished no information. It also assumes that this “Notice of [817] Sale” was a usual or at least simple thing; we take judicial (or professional) notice that it was most unusual. For these reasons, we find no legal compulsion on petitioner to take one course rather than the other, and, if there was no obligation by law, there was (also by law) room for honest choice. As such choice was made, the master’s report was right. Reference is given us to Konitzky v. Meyer, 49 N. Y. 571. That decision recognizes a vendor’s right to mingle cheaper and costlier ingredients in what he sells without price agreement, “in the usual manner.” This is a fairly close analogy, but the matter must remain, after prolonged search, without further citations of authority. Order reversed, with costs, and cause remanded, with directions to confirm the report of special master.