cuit Court, from which no writ of error is taken, and rendered in the Federal court after it has sustained its own jurisdiction and refused to remand the action?

In view of the fact that the question is a Federal one, and that the state court is given no right to review or control the exercise of the jurisdiction of the Federal court, we think that such Federal judgment cannot be ignored in the state court as one absolutely void for want of jurisdiction, and that such judgment, until reversed by a proper proceeding in this court, is binding upon the parties, and must be given force when set up in the action. This view is sustained in the former decisions of this court upon the subject. In Des Moines Navigation Company v. Iowa Homestead Company, 123 U. S. 552, this court considered the effect of a judgment rendered in the Federal court upon removal from the state court. In that case it appeared that the Federal court ought not in fact to have taken jurisdiction, for it appeared upon the face of the record that some of the defendants who did not join in the petition for removal were citizens of the same State as the plaintiff. The state court of Iowa refused to give effect to the judgment of the Federal court, and its judgment was reversed. Mr. Chief Justice Waite, speaking for the court, said (123 U. S. 559):

"Whether in such a case the suit could be removed was a question for the Circuit Court to decide when it was called on to take jurisdiction. If it kept the case when it ought to have been remanded, or if it proceeded to adjudicate on matters in dispute between two citizens of Iowa, when it ought to have confined itself to those between the citizens of Iowa and the citizens of New York, its final decree in the suit could have been reversed, on appeal, as erroneous, but the decree would not have been a nullity. To determine whether the suit was removable in whole or in part or not, was certainly within the power of the Circuit Court. The decision of that question was the exercise and the rightful exercise of jurisdiction, no matter whether in favor of or against taking the cause. Whether its

decision was right, in this or any other respect, was to be finally determined by this court on appeal."

In Dowell v. Applegate, 152 U. S. 327, the benefit of a judgment in the Circuit Court of the United States was claimed. That judgment was the basis of a conveyance to the plaintiff in error, and it was contended that the conveyance was void, inasmuch as the Federal court had no jurisdiction of the suit in which the sale was ordered. It was held in this court that even if the Federal court erred in assuming or retaining jurisdiction of the suit, its decree being unmodified and unreversed, could not be treated as a nullity. After citing previous decisions of this court, the court, speaking through Mr. Justice Harlan, said (152 U. S. 340):

"These cases establish the doctrine that, although the presumption in every stage of a cause in a Circuit Court of the United States is that the court is without jurisdiction unless the contrary affirmatively appears from the record, Börs v. Preston, 111 U. S. 252, 255, and the authorities there cited, yet, if such jurisdiction does not so appear, the judgment or final decree cannot, for that reason, be collaterally attacked, or treated as a nullity.

"These authorities, above cited, it is said, do not meet the present case, because the ground on which, it is claimed, the Federal court assumed jurisdiction was insufficient in law to make this case one arising under the laws of the United States. But that was a question which the Circuit Court of the United States was competent to determine in the first instance. Its determination of it was the exercise of jurisdiction. Even if that court erred in entertaining jurisdiction, its determination of that matter was conclusive upon the parties before it, and could not be questioned by them, or either of them, collaterally, or otherwise than on writ of error or appeal to this court."

Applying these principles to the case at bar, we think the state court erred in refusing to give effect to the judgment set up in the answer offered in the state court. When the application for removal was made in the state Circuit Court that court.

held the case removable, and the record was filed in the Federal court. Afterwards that court, upon the application of the plaintiff, refused to remand the suit, and proceeded to a final determination thereof, and rendered judgment accordingly.

It is not necessary to determine whether the case was removable or not. The Federal court was given jurisdiction to determine that question, it did determine it, and its judgment was conclusive upon the parties before it, until reversed by a proper proceeding in this court. Instead of bringing the case here the plaintiff proceeded in the state court, and that court denied effect to the Federal judgment. The plaintiff in error lost no right when thus compelled to remain in the state court, notwithstanding the Federal judgment in his favor, and brought the suit here by writ of error to the final judgment of the state court, denying his right secured by the Federal judgment. It was open to the plaintiff to bring the adverse decision of the Federal court on the question of jurisdiction to this court for review. This course was not pursued, but the action proceeded in the state court evidently upon the theory that the judgment of the Federal court was a nullity if it had erred in taking jurisdiction. · For the reasons stated we think this hypothesis is not maintainable.

The judgment of the Court of Appeals of Kentucky is reversed and the cause is remanded for further proceedings not inconsistent with this opinion.

Dissenting: MR. JUSTICE MCKENNA.

CODER, TRUSTEE OF ARMSTRONG, BANKRUPT, v.

ARTS.

APPEAL FROM THE CIRCUIT COURT OF APPEALS FOR THE EIGHTH

CIRCUIT.

No. 93. Argued January 26, 1909.-Decided April 5, 1909.

Where a creditor presents a claim to the trustee joined with a statement that he has security upon the estate which it is his purpose to maintain and upon which he is entitled to priority, he institutes a proceeding in bankruptcy as distinguished from a controversy arising in the course of bankruptcy proceedings and an appeal lies to the Circuit Court of Appeals under § 25b, and the party aggrieved is not limited by § 246 to a petition for revision; and an appeal also lies to this court, under the rules prescribed by it, if the amount involved exceeds $2,000 and the question involved is one which gives jurisdiction to this court to review judgments of the state courts under § 709, Rev. Stat., or if a certificate of a justice of this court is made as required by par. 2 of subd. b of § 25.

General Order of this court, No. 36 in bankruptcy, which requires an appeal from a judgment of the Circuit Court of Appeals to be taken within thirty days, and that the court from which the appeal lies to make findings of fact and conclusions of law within thirty days held to be complied with by the Circuit Court of Appeals making findings within such thirty days, and directing them to be filed nunc pro tunc as of the day of entry of judgment, the appeal having also been taken within thirty days from such day of entry.

Where the claimant against a bankrupt's estate asserts a lien which would be defeated under the construction placed upon the bankruptcy act by the trustee, and the lien is allowed, a Federal question is involved, which if involved in a case in the state court would give this court jurisdiction to review the judgment under § 709, Rev. Stat., and the case is appealable from the Circuit Court of Appeals to this court under § 256 of the bankruptcy act.

On appeals from the Circuit Court of Appeals under § 256 this court, under par. 3 of General Orders in Bankruptcy No. 36, can only look at the facts found by the Circuit Court of Appeals.

An attempt to prefer is not necessarily an attempt to defraud, nor is a

Argument for Appellant.

213 U.S.

preferential transfer always a fraudulent one. The question of fraud depends upon the motive, and in order to invalidate a conveyance as one made to hinder, delay or defraud creditors within the meaning of § 67e of the bankruptcy act actual fraud must be shown.

In this case a mortgage given within four months of filing the petition to secure advances and while the mortgagee did not know of the mortgagor's insolvency, although the latter did, and which mortgage was found not to have been made with intent to hinder, delay or defraud creditors, held not to be voidable under § 67e of the bankruptcy law and that the mortgagee was entitled to priority thereon with interest.

152 Fed. Rep. 943, affirmed.

THE facts, which involve the construction of certain provisions of the bankruptcy act, are stated in the opinion.

Mr. Myron L. Learned, for appellant:

This controversy was one "arising in bankruptcy proceedings" and was therefore appealable under § 24a of the bankruptcy act. Hewit v. Berlin Machine Works, 194 U. S. 296; Dodge v. Norlin, 133 Fed. Rep. 363, and cases there cited; In re McKenzie, 142 Fed. Rep. 383; In re Holmes, 142 Fed. Rep. 391; Hendricks v. Webster, 159 Fed. Rep. 927; Burleigh v. Foreman, 125 Fed. Rep. 217; Smith v. Means, 148 Fed. Rep. 89; Mason v. Wolkowich, 150 Fed. Rep. 699; Security Warehousing Co. v. Hand, 143 Fed. Rep. 32; Hinds v. Moore, 134 Fed. Rep. 221; McCarty v. Coffin, 150 Fed. Rep. 307; In re McMahon, 147 Fed. Rep. 684; In re Mueller, 135 Fed. Rep. 711.

The intent and purpose to hinder, delay or defraud creditors are to be presumed from the giving of the mortgage of May 2, 1904, when its necessary effect was to so hinder, delay or defraud. Crow v. Beardsley, 68 Missouri, 439; Wager v. Hall, 16 Wall. 584; Johnson v. Wald, 93 Fed. Rep. 640; In re McGee, 105 Fed. Rep. 895; Toof v. Martin, 13 Wall. 40; Wilson v. City Bank, 17 Wall. 473; Western Tie & Timber Co. v. Brown, 196 U. S. 502; In re Ed. W. Wright Lumber Co., 114 Fed. Rep.