at L. 562, 563, U. S. Comp. Stat. 1901, p., lessee will pay any rents after his default 3447), because it is not "a fixed liability and the re-entry by the lessor. The use absolutely owing at the time of and occupation of the premises during the the filing of the petition against him" (§ term of the lease were the consideration for 63a), and because it is not an ex- the payment of the monthly rents, and the isting demand, but both the existence payment of the rents was the consideration and the amount of the possible future de- for the use of the premises. If the rent mand are contingent upon unforeseen for any month was not paid, or if waste events, such as default of the lessee, re-entry was permitted, the lessor had the option by the lessor, and assumption by the trus- to repossess himself of the premises, and tee, so that it is neither an unliquidat- to withold from thenceforth the consideraed nor a liquidated provable claim ( tion for future instalments of rent, or to 63b). Walla Walla v. Walla Walla Water permit the lessee to continue in possession Co. 172 U. S. 1, 19, 43 L. ed. 341, 349, of the property, and to enforce the collection 19 Sup. Ct. Rep. 77; Re Ells, 2 N. B. N. of the rents by an action or by some other Rep. 360, 98 Fed. 967, 969, 970; Re Mahler, | proceeding. He could not, however, do 3 N. B. N. Rep. 39, 105 Fed. 428, 430; both. His resumption of the premises necFidelity Safe Deposit & T. Co. v. Arm- essarily constituted, in the absence of an strong, 35 Fed. 567, 569; Re Hevenor, 144 express agreement to the contrary, a terN. Y. 271, 274, 39 N. E. 393; Re Commer-mination of the lease, and a release of the cial Bulletin Co. 2 Woods, 220, Fed. Cas. No. 3,060; Re Collignon, 4 Am. Bankr. Rep. 250; Atkins v. Wilcox, 53 L. R. A. 118, 44 C. C. A. 626, 3 N. B. N. Rep. 497, 105 Fed. 595; Re Curtis, 109 La. 171, 9 Am. Bankr. Rep. 286, 292, 295, 94 Am. St. Rep. 445, 33 So. 125; Re Heinsfurter, 97 Fed. 198; Beers v. Hanlin, 3 N. B. N. Rep. 749, 99 Fed. 695; Lamson Consol. Store Service Co. v. Bowland, 52 C. C. A. 335, 338, 114 Fed. 639, 642; Wilson v. Pennsylvania Trust Co. 52 C. C. A. 374, 114 Fed. 742.

In Deane v. Caldwell, 127 Mass. 242, 244, Chief Justice Gray (subsequently Mr. Justice Gray of the supreme court) announced the true rule upon this subject in these words: "Before the day at which rent is covenanted to be paid, it is in no sense a debt. It is neither debitum nor solvendum; for, if the lessee is evicted before that day, it never becomes payable. Bordman v. Osborn, 23 Pick. 295. It is not within the provision of a bankrupt act allowing 'uncertain or contingent demands' to be proved against the estate of a bankrupt, because it is not an existing demand, the cause of action on which depends upon a contingency; but the very existence of the demand depends upon a contingency."

The lease before us admirably illustrates the principle. It provides that the lessee shall pay $60 per month for the term of ten years "for the use and benefit accruing to him from the use and occupancy" of the premises; that, if he pays these sums as they fall due, and performs all his covenants, he may hold and enjoy the premises; but that, if any rents are due and unpaid, or if default is made in any of his covenants, or if he allows any undue waste of any of the improvements on the premises, the lessor may at once re-enter and repossess the premises. The contract contains no covenant that the

lessee from the payment of all the instalments of rent he had promised to pay there. after. Lamson Consol. Store Service Co. v. Bowland, 52 C. C. A. 335, 338, 114 Fed. 639, 642.

Moreover, if by contract or by virtue of legal proceedings the lessor became entitled to the possession of the premises, and also to the difference between the amount which he might secure from another tenant, or the rental value of the leasehold, and the rents reserved, that amount would always be uncertain and contingent upon future events. Re Hevenor, 144 N. Y. 271, 274, 39 N. E. 393.

When the petition in bankruptcy was filed, no rent was due and unpaid. There was therefore no debt owing by the lessee to Watson, and the latter had no legal demand or claim against him under the lease. The future existence of any such claim or demand, and its amount, if it ever came into existence, were contingent upon (1) the future default of the lessee; (2) the exercise by the lessor of his option to resume the possession of the leased premises if such a default should occur; and (3) upon the assumption of the lease by the trustee in bankruptcy. For the latter had the option to take the leasehold estate, and to assume the payment of the agreed rents. Ex parte Houghton, 1 Low. Dec. 554, Fed. Cas. No. 6,725; Ames v. Union P. R. Co. 60 Fed. 966, 970, 971; Re Ells, 2 N. B. N. Rep. 360, 98 Fed. 967, 968. As the lessor had no legal claim or demand against the lessee for the agreed rents to be paid in the future, when the petition in bankruptcy was filed; and as the future existence and the amount of such a claim were both contingent upon unforeseen future events,-Watson had no provable claim for any part of these rents. Since his claim is in fact for nothing but $12.50 per month of the agreed rents pay

able after the filing of the petition in bank- | liable for his debts; but he does acquire the ruptcy, the application to it of the title of a claim for damages for a breach of the lease neither changes its nature, nor makes it more provable than it would have been if its real character had been described by its name.

right to accept and assume, or to renounce, the executory agreements of the bankrupt, as he may deem most advantageous to the estate he is administering; and the parties to those contracts which he assumes are still liable to perform them. And so throughout the entire field of contractual obligations the adjudication in bankruptcy absolves from no agreement, terminates no contract, and discharges no liability. Re Curtis, 109 La. 171, 9 Am. Bankr. Rep. 286, 94 Am. St. Rep. 445, 33 So. 125; Re Ells, 2 N. B. N. Rep. 360, 98 Fed. 967, 968; Witthaus v. Zimmerman, 91 App. Div. 202, 11 Am. Bankr. Rep. 314, 316, 86 N. Y. Supp. 315; White v. Griffing, 44 Coяn. 437. 446, 447; Re Pennewell, 55 C. C. A. 571, 9 Am. Bankr. Rep. 490, 119 Fed. 189.

3. Not only this, but, if counsel for appellant could sustain his proposition that the adjudication of bankruptcy absolved the parties to the lease from their contract at the date of the filing of the petition in bankruptcy, or terminated the lease on that day, still the lessor would have no legal claim against the estate, because the petition was filed on February 6, 1903, the rent was paid by Brown to March 1, 1903, there had been no breach of the contract when the petition was filed, and, if both parties were released from the agreement at that time, or if the lease was then terminated, neither party could have subsequently been in default under it or have committed a breach of it, because thereafter no contract would have existed to be defaulted, and no covenant to be broken.

2. An adjudication in bankruptcy does not dissolve or terminate the contractual relations of the bankrupt, notwithstanding the decisions to the contrary in Re Jefferson, 2 Am. Bankr. Rep. 206, 93 Fed. 948; Bray v. Cobb, 3 Am. Bankr. Rep. 788, 100 Fed. 270; and Re Hays, F. & W. Co. 117 Fed. 879. Its effect is to transfer to the trustee all the property of the bankrupt except his executory contracts, and to vest in the trustee the option to assume or to renounce these. It is the assignment of the property of the bankrupt to the trustee by operation of law. It neither releases nor absolves the debtor from any of his contracts or obligations, but, like any other assignment of property by an obligor, leaves him bound by his agreements, and subject to the liabilities he has incurred. It is the discharge of the bankrupt alone, not his adjudication, that releases him from liability for provable debts in consideration of his surrender of his property, and its distribution among the creditors who hold them. Even the discharge fails to relieve him from claims against him that are not provable in bankruptcy; and, since his obligation to pay rents which are to accrue after the filing of the petition in bankruptcy may not be the basis of a provable claim. his liability for them is neither released nor affected by his adjudication in bank- 4. Finally the adjudication in bankruptcy ruptcy, or by his discharge from his prov- did not constitute a breach of the lease, and able debts. One agrees to pay monthly it raised no cause of action as of the date rents for the place of residence of his fam- of the filing of the petition in bankruptcy. ily or for his place of business, or to render At that date the rent had been paid until personal services for monthly compensation March 1, 1903,-until twenty-two days after for a term of years; he agrees to purchase the date of the filing. There could thereor to convey property; and he then becomes fore have been no breach until March 1, insolvent and is adjudicated a bankrupt. 1903, when the rent for March fel due; His obligations and liabilities are neither and consequently there was no claim or terminated nor released by the adjudication. demand founded on a breach of the contract He still remains legally bound to pay the at the time the petition was filed, and, if rents, to render the services, and to fulfil one ever accrued, it arose many days after all his other obligations, notwithstanding the filing of the petition, and too late to the fact that his insolvency may render constitute a provable claim against the him unable immediately to do so. Nor are estate of the bankrupt. The rule of law those who contracted with him absolved that, where one has disabled himself from from their obligations. If he or his trustee performing a contract, it immediately pays the stipulated rents for his place of ripens, and an action for its breach arises, residence, or for his place of business, the which is illustrated by Re Swift, 50 C. C. lessors may not deny to the payor the use A. 264, 112 Fed. 315, wherein a stockbroker of the premises according to the terms of had made a contract to deliver stock the lease. If he renders the personal serv- to a customer, and he was held to ices, he who contracted to pay for them have made it impossible for him to may not deny his liability to discharge this fulfil his agreement by his adjudicaobligation. His trustee does not become tion in bankruptcy, which took the stock

66 C. C. A. 78, 130 Fed. 881, cited by appellant's counsel, fail to rule the question here under consideration, because the breaches of contract in those cases occurred before the petitions in bankruptcy were filed.

from him, and vested it and all his 604, and Re Frederick L. Grant Shoe Co. property in his trustee, is not in conflict with this conclusion, because the leasehold estate of Brown-the only thing essential to the performance of his contract-never passed to his trustee, as the latter did not elect to assume it. Brown was not necessarily disabled by the adjudication from using or selling his leasehold, or from paying the rent. The mere probable financial inability of one to fulfil his contract, or to pay his debt not yet due, does not make them immediately due and actionable. The cases Re Stern, 54 C. C. A. 60, 116 Fed.

The conclusion is that a claim for damages for a breach of a contract in a lease to pay instalments of rent for the use of the premises at times subsequent to the filing of the petition in bankruptcy is not provable under the bankruptcy law of 1898, and the order of the District Court is af'firmed.

UNITED STATES CIRCUIT COURT OF APPEALS, FIRST CIRCUIT.

Town of NAHANT, Plff. in Err.,

v.

UNITED STATES of America, Impleaded, etc.

(136 Fed. 273.)

an

1. A state statute acquiescing in attempt by the Federal government to acquire land within the state for the

This right is independent of the consent of any state, and requires no state legislation as a condition precedent to its exercise.

Kohl v. United States, 91 U. S. 367, 23 L. ed. 449; Ft. Leavenworth R. Co. v. Lowe, 114 U. S. 525, 29 L. ed. 264, 5 Sup. Ct. Rep. 995.

The commonwealth of Massachusetts did not, by chapter 373 of the Acts of 1902, del

use of such government does not entitle the egate to the United States the authority to

government to employ the local rule of damages as the measure of its liability for property taken.

2. The value of sewer and water pipes

owned by a municipal corporation, and laid under streets which are taken by the Federal government under its power of eminent domain for an entirely different use, must be paid to the municipality.

(March 20, 1905.)

Court of the United States for the District of Massachusetts to review a judgment refusing compensation to the town of Nahant for the value of certain property alleged to have been taken by the United States under its power of eminent domain. Reversed.

ERROR to the District

The facts are stated in the opinion. Argued before Colt and Putnam, Circuit Judges, and Aldrich, District Judge.

Messrs. James R. Dunbar and William Hoag, for plaintiff in error:

The United States possesses, as an inherent attribute of sovereignty, the right of eminent domain,-the right to take private property for public uses within the scope of the powers granted by the Constitution.

NOTE. As to right of public to compensation upon interference with its interests by the exercise of the right of eminent domain, see Seattle & M. R. Co. v. Washington, 22 L. R. A. 217; Heffner v. Cass & Morgan Counties, 58 L. R. A. 353; Zanesville v. Zanesville Teleg. & Teleph. Co. 52 L. R. A. 150.

exercise the right of eminent domain of the
commonwealth in this case.

Boston, 14 Gray, 282; People ex rel. Hayden
Perry v. Wilson, 7 Mass. 393; Glover v.
v. Rochester, 50 N. Y. 525; Currier v. Mari-
etta & C. R. Co. 11 Ohio St. 228; Butler v.
Thomasville, 74 Ga. 570; Peavey v. Calais
R. Co. 30 Me. 498; Burt v. Merchants' Ins.
Co. 106 Mass. 356, 8 Am. Rep. 339; Kohl v.
United States, 91 U. S. 374, 23 L. ed. 452.

Property of the town of Nahant was taken by the United States by force of these proceedings.

Newburyport Water Co. v. Newburyport, 168 Mass. 541, 47 N. E. 533.

An easement is property within the meaning of the 5th Amendment to the Constitution of the United States.

United States v. Great Falls Mfg. Co. 112 U. S. 645, 28 L. ed. 846, 5 Sup. Ct. Rep. 306; Great Falls Mfg. Co. v. Atty. Gen. (Great Falls Mfg. Co. v. Garland) 124 U. S. 581, 31 L. ed. 527, 8 Sup. Ct. Rep. 631; Lowndes v. United States, 105 Fed. 838; United States v. Certain Lands, 112 Fed. 622.

The taking away of the usefulness of a piece of property is a taking of the property itself.

Lewis, Em. Dom. 2d ed. pp. 49, 61-63; Eaton v. Boston, C. & M. R. Co. 51 N. H. 504, 12 Am. Rep. 147.

To the extent of its impairment in useful