The sixth defense is a repetition of the fifth in part, and to it is added the following:

"That the said judicial proceedings in which said premises were sold as aforesaid were proceedings instituted in the court of common pleas for Edgefield county for the purpose of subjecting the estate of the late Charles A. Cheatham to the payment of his debts, and under the said proceedings a certain portion of the proceeds of sale of the real estate (including the land and premises mentioned and described in the said third article of the complaint herein) of the said Charles A. Cheatham was set aside and applied to the purchase of a homestead for the benefit of the widow and children (to wit, the two plaintiffs herein) of the said Charles A. Cheatham. That the said plaintiffs have enjoyed the benefit of the said homestead so purchased with the said proceeds of sale, and have lately sold the said homestead so purchased, or a portion thereof, and used and applied to their own benefit the proceeds of sale thereof, and have thereby, as this defendant alleges, ratified, approved, and confirmed in all respects the action of the court in making said sale, and the said sale made thereunder, to the grantor of this defendant, of the lands and premises described in the said third article of said complaint, and are now estopped to deny the title of this defendant thereto."

The seventh defense likewise alleges the judicial sale, and adds: "And that the plaintiffs, and both of them, well knew that this defendant and their grantors claimed and were in possession of the said lands and premises under a sale made in an equity suit to which they, the said plaintiffs, were originally parties; that they have for years remained silent while the defendant has been in possession of the said premises, and while said defendant and its grantors have expended large sums in the improvement of said premises, during all of which period, and while this defendant and its grantors were in possession and expending large sums in the improving of said premises, plaintiffs, and each of them, have forborne to raise any question whatever as to the validity of the title of this defendant, and by their conduct, and the conduct of each of them, they have indicated their purpose not to make any issue in reference thereto, and upon the faith of which conduct on the part of the plaintiffs this defendant and their grantors have acted. Whereby said plaintiffs, and each of them, are now estopped to dispute or deny the title of this defendant to the said land and premises."

The eighth defense, after stating the judicial sale, says:

"And that the proceeds of said sale were applied to the payment of the debts and liabilities of Charles A. Cheatham, the father and devisor of the plaintiffs, and in especial to the payment of a mortgage for the purchase money made upon the said premises by the said Charles A. Cheatham in his lifetime; and that the benefits of such payments so made and inuring to the plaintiffs have been accepted and acquiesced in by the plaintiffs, who are thereby now estopped to deny the title of this defendant to such premises and tract of land."

Under the Code of South Carolina irrelevant or redundant matter in a pleading may be stricken out on motion, and an allegation is irrelevant when the issue formed by its denial can have no connection with or effect upon the cause of action. The first case relied upon by counsel for plaintiffs is Buist v. Salvo, 44 S. C. 143, 21 S. E. 615, which held that a demurrer cannot be sustained which is good only as to some of the paragraphs of the complaint; and as it is claimed that the first paragraph in each of these separate answers states a legal defense the motion is to strike out those paragraphs which are in the nature of equitable estoppels. The next case cited is Harman v. Harman, 54 S. C. 100, 31 S. E. 881, which does not seem to have any special bearing; and Lawson v. Gee, 57 S. C. 502, 35 S. E. 759, which indicates that, where parts of a defense are irrelevant, the proper practice is a motion

to strike out, a demurrer is not the proper practice when it is only as to certain paragraphs of the defense. Allan v. Cooley, 60 S. C. 370, 38 S. E. 622, and Ragsdale v. Southern Railway, 60 S. C. 381, 38 S. E. 609, and Marion v. City Council (S. C.) 47 S. E. 140, all go to sustain the contention that the proper practice in cases of this nature is that pursued by plaintiffs. This view is undoubtedly correct if the first paragraph in the sixth, seventh, and eighth defenses is to be taken as setting up a purely legal defense, for the allegations of equitable estoppel set up in the paragraphs sought to be stricken out are not necessary to support the legal defense, and should not be blended with it; but the reference to the legal proceedings as stated in each of these separate defenses is not to be so interpreted. That legal defense is stated separately in the fifth defense, and, of course, if sustained, will be a bar to this action. The reference to these proceedings in the sixth, seventh, and eighth defenses is by way of inducement merely. They refer to the legal proceedings with a view of bringing home to the defendant certain knowledge, and then allege certain facts which constitute an estoppel en pais, upon which the defendant would rely as a defense even if the judicial proceedings were a nullity. If this view of these separate defenses is correct, it would seem that a demurrer would lie to the whole, but it is of little consequence in this case whether the motion should be considered as one to strike out certain allegations or as a demurrer to the whole separate defense. In neither view can it be sustained. The motion rests upon the ground that in actions of ejectment in the courts of the United States the strict legal title must prevail, and that any equities should be considered only on the equity side of the court. Undoubtedly that is the general rule, and it is so held in Foster v. Mora, 98 U. S. 428, 25 L. Ed. 191, and in other cases relied upon by the learned counsel for plaintiffs; but to this rule there are well-defined exceptions, and the allegations of equitable estoppel sought to be stricken out fall within these exceptions. In Dickerson v. Colgrove, 100 U. S. 578, 25 L. Ed. 618, where the purchaser of land in Michigan, which had descended to a sister living in that state and a brother who was resident of California, and who had bought from the sister and her husband with covenants of general warranty, after learning of the brother's interest, wrote to him concerning it. The brother wrote to the sister, saying:

"You can tell D. for me he need not fear anything from me; you can claim all there; this letter will be enough for him. I intend to give you and yours all my property there and more if you needed it."

Upon the contents of this letter becoming known to D., he conveyed the lands, for a valuable consideration, to others, who had occupied and improved them. The brother subsequently sued in ejectment, and the court held that the letter above referred to was an estoppel en pais, which precluded him from setting up a claim to the land, and was an available defense to the action. It says:

"The vital principle is that he who, by his language or conduct, leads another to do what he would not otherwise have done, shall not subject such person to loss or injury by disappointing the expectations upon which he acted."

It discusses the question at some length, and directly decides that in a case like that the defense may be made at law. In Kirk v. Hamilton, 102 U. S. 68, 26 L. Ed. 79, where the plaintiff, having knowledge that defendant, who claimed under a judicial sale, was expending money and making improvements on the premises, and had asserted no title thereto while that was going on, was held to be estopped from maintaining his action; and this independently of the question whether a sale by the trustee and its confirmation by the court was itself a valid, binding transfer of the title to the purchasers; the court saying:

"He was silent when good faith required him to put the purchasers on guard. He should not now be heard to say that that is not true which his conduct unmistakably declared was true, and upon the faith of which others acted."

These cases, decided since Foster v. Mora, are directly to the point that an equitable estoppel may be set up as a defense in cases of ejectment in courts of law of the United States, and are conclusive of the question. They have been repeatedly followed. Berry v. Seawall, 65 Fed. 753, 13 C. C. A. 101; City of Cleveland v. Cleveland, etc., Railway Company (C. C.) 93 Fed. 123; National Nickel Company v. Nevada Nickel Syndicate, 112 Fed. 46, 50 C. C. A. 113. Motion to strike out is therefore denied, with costs.

In re SCHERBER.

(District Court, D. Massachusetts. July 22, 1904.)
No. 8,102.

1 BANKRUPTCY — REFERENCE - RECOVERY-SUMMARY PROCEEDINGS JURISDICTION.

Where, in the petition of a trustee in bankruptcy to recover an alleged preference by summary proceedings, there was no allegation that respondent's claim was colorable only, and respondent promptly objected to the form of the proceeding, the court of bankruptcy had no jurisdiction to determine the matter except by plenary suit.

In Bankruptcy.

Arthur E. Burr, pro se.

Brandeis, Dunbar & Nutter, for creditor.

LOWELL, District Judge. On January 6, 1904, the trustee in bankruptcy filed with the referee the following petition:

"In the Matter of John F. Scherber, Bankrupt. In Bankruptcy. (No. 8,102.) "Petition to Recover a Preference from Charles P. Holden, of Boston, in Said District of Massachusetts.

"Respectfully represents your petitioner, Arthur E. Burr, duly appointed trustee of the estate of the aforesaid bankrupt, that said Charles P. Holden is a creditor of the aforesaid bankrupt; that, within four months before the filing of the petition by the aforesaid bankrupt, said bankrupt made a transfer of certain of his property, to the amount of three hundred forty and 26/100 (340.26) dollars, to said Charles P. Holden; that the effect of the enforcement of said transfer will be to enable Charles P. Holden to obtain a greater percentage of his debt than any other creditor of the same class; that the said trans

fer constituted a preference; that said Charles P. Holden had reasonable cause to believe that it was intended by said transfer and preference to give a preference. Wherefore your petitioner prays that he may recover said property, or its value, from said Charles P. Holden, and that this court may make suitable orders and decrees whereby your petitioner may be enabled to recover said property."

The referee thereupon issued the following order of notice:

"To Charles P. Holden, of Boston, in Said District of Massachusetts: You are hereby notified to appear before this court, at 704 Tremont building, in said Boston, on the 20th day of January, A. D. 1904, at 10 a. m., to show cause, if any you have, why you should not be ordered to pay over to Arthur E. Burr, trustee of the aforesaid estate in bankruptcy, the sum of three hundred forty and 28/100 (340.26) dollars, according to the prayer of the petition of said trustee, filed in this court on the 6th day of January, 1904, in which petition it is alleged that you have received said amount as a preference from the aforesaid bankrupt. Emery B. Gibbs, Referee."

Service was accepted by Holden as follows: "Due and sufficient service of the within order of notice is hereby accepted on behalf of Charles P. Holden, within named.

"Brandeis, Dunbar & Nutter." Thereafter Holden appeared specially and filed the following motion:

"Motion of Charles P. Holden to Dismiss Trustee's Petition.

"Now comes Charles P. Holden, summoned as respondent in the above matter, appearing specially for this purpose only, and moves that the trustee's petition be dismissed upon the ground that it appears by the face of said petition that the trustee seeks therein to set aside an alleged preference to this respondent by summary proceeding before the referee in bankruptcy, and that by the bankrupt act the referee has no power or jurisdiction to entertain such petition.

"By his Attorneys,

Brandeis, Dunbar & Nutter."

No evidence being presented, the referee overruled the motion. Holden thereupon filed the following petition:

"Petition for Review.

"Now comes Charles P. Holden, summoned as respondent in the matter of the petition by the trustee for the purpose of setting aside certain payments alleged to have been made by the bankrupt to said respondent as a preference, and says that, in the proceedings before the referee upon said petition, an error has happened, in that said referee has overruled the motion of said respondent that said trustee's petition be dismissed upon the ground that it appeared by the face of said petition that the trustee sought therein to set aside an alleged preference to this respondent by summary proceedings before the referee in bankruptcy, and that by the bankrupt act the referee had no power or jurisdiction to entertain such petition. Wherefore this respondent requests that the referee forthwith certify to the District Judge the question presented, a statement of the trustee's petition, and the motion of this respondent, and the findings and order of the referee thereon.

"By his Attorneys,

Brandeis, Dunbar & Nutter."

The case presents two questions: (1) May the proceedings in a court of bankruptcy to recover a preference be by summary petition, notwithstanding the respondent's seasonable objection to this form of proceeding, or must they be by plenary suit? (2) Has a referee jurisdiction of proceedings to recover a preference, however framed, if the respondent objects to his exercise of jurisdiction? The case has been ably argued,

and the court has been helped by the acute discussion of counsel on both sides.

1. In re Steuer (D. C.) 104 Fed. 976, this court decided that, in proceedings to recover a preference, where the jurisdiction of the referee was not objected to, and where the summary petition contained all the substantial allegations of a bill in equity, the judge, on appeal from the referee, had jurisdiction to decree the return of the preference, whether the referee originally had jurisdiction of the proceedings or not. See Bryan v. Bernheimer, 181 U. S. 188, 21 Sup. Ct. 557, 45 L. Ed. 814, where it is implied, if not expressly decided, that consent will give jurisdiction to the referee over a summary petition against an adverse claimant, although, without consent, the court of bankruptcy would be altogether without jurisdiction. See, also, In re Thompson (C. C. A.) 128 Fed. 575. Later decisions binding upon this court contain nothing contrary to In re Steuer. But in the case at bar due objection to the jurisdiction was taken. Louisville Trust Co. v. Comingor, 184 U. S. 18, 22 Sup. Ct. 293, 46 L. Ed. 413. In White v. Schloerb, 178 U. S. 542, 20 Sup. Ct. 1007, 44 L. Ed. 1183, the Supreme Court held that property taken from the custody of a trustee in bankruptcy may be recovered by him summarily, and without a plenary suit. In re Redburn, Ex parte Rochford, 124 Fed. 182, 59 Ĉ. C. A. 388; In re Kellogg, 121 Fed. 333, 57 C. C. A. 547; In re Reynolds (D. C.) 127 Fed. 760. If there be anything to the contrary in In re Russell, 101 Fed. 248, 41 C. C. A. 323, it must be taken as overruled. The ultimate disposition of property which has thus come into the possession of the court of bankruptcy may, it seems, be determined by summary proceedings before the referee. See Ex parte Rochford, 124 Fed. 182, 59 C. C. A. 388; In re Kellogg, 121 Fed. 333, 57 C. C. A. 547; Hutchinson v. Le Roy, 113 Fed. 202, 51 C. C. A. 159. But in the case at bar the property was never in the possession of the trustee. In Mueller v. Nugent, 184 U. S. 1, 22 Sup. Ct. 269, 46 L. Ed. 405, the Supreme Court decided that where the respondent's claim to hold property alleged to belong to the bankrupt estate was merely colorable, and not really adverse, the trustee might recover the property by summary proceedings instituted before the referee, without resorting to a plenary suit. Therefore Mueller v. Nugent decided that in summary proceedings the referee may inquire if the claim is really adverse; declining jurisdiction if this is made to appear, taking jurisdiction_if_the adverse claim is merely colorable. See In re Durham (D. C.) 114 Fed. 750; In re Tune (D. C.) 115 Fed. 906; In re Waukesha Water Co. (D. C.) 116 Fed. 1009; In re Davis (D. C.) 119 Fed. 950; In re Breslauer (D. C.) 121 Fed. 910; In re Knight (D. C.) 125 Fed. 35; In re Weinger (D. C.) 126 Fed. 875; In re Teschmacher (D. C.) 127 Fed. 728. These cases have not drawn definitely the line between claims only colorably adverse and those which are really so. See In re Krinsky (D. C.) 112 Fed. 972. But the respondent's claim in the case at bar is not alleged in the petition to be merely colorable, and must be taken to be really adverse. Where this is true, and where due objection to the form of proceeding is made, the decisions and language of the Supreme Court imply that a plenary suit must be resorted to. See Louisville Trust Co. v. Comingor, 184 U. S. 18, 22 Sup. Ct. 293, 46 L. Ed. 413.