Reed & Kerr, for appellant. Fred B. Dodge, for respondents.

DICKINSON, J. This is an action by the receiver (appointed under our insolvent law) of an insolvent debtor to recover money paid by the insolvent to the defendants, his creditors, in discharge of the indebtedness, less than four months prior to the insolvency proceedings; such payment being claimed to be an unlawful preference by force of the statute. The statute makes invalid a preferential payment by an insolvent debtor only in case the creditor has reasonable cause to believe the debtor to be insolvent. Upon the evidence the court found that the defendants did not know, nor did they have reasonable cause to believe, their debtor to be insolvent when the payment was made. The principal question on this ap peal is whether the evidence justified that finding. In our opinion, it did. As to the undisputed facts, it may be said that they are not inconsistent with that conclusion. For instance, the fact that the debtor was not ready to pay this debt when application for payment was made, and desired to postpone payment, may be explained by the fact that the debt was not then due. And to the suggestion that the application by the creditors for payment, before the maturity of the debt, indicates their apprehension of his insolvency, it is reasonably explained that the debtor was understood to be about to sell out his property and go out of business, on account of ill health, a favorable opportunity for doing so being presented. The testimony bearing most directly upon this point was conflicting, and upon the whole case we find no reason for overruling the decision of the learned judge who heard the evidence. The plaintiff claims that the prior insolvency proceedings, culminating in the order of the court appoint. ing the receiver, determined the very question here involved, so that it was res judicata. The determination of the insolvency of the debtor, and that he had preferred certain creditors, including these defendants, upon which the order appointing the receiver was based, was not an adjudication of the question whether the creditors had reasonable cause to believe the debtor to be insolvent when they received the payment which constituted a preference. That question was not involved or passed upon in the proceeding. Under section 2 of the insolvent law, if an insolvent creditor does any act whereby any creditor obtains a preference, that is made a cause for which his creditors may institute insolvency proceedings against him and seek the appointment of a receiver; but whether the preferential act of the debtor may be avoided depends upon a condition prescribed in section 4, not involved in the hearing or determination of the application for the appointment of a receiver; that is, upon the fact of the preferred creditor having cause to believe the debtor to be insolvent. That was wholly immaterial in the former proceed

Order affirmed.

LANSING et al. v. CITY OF LINCOLN et al. (Supreme Court of Nebraska. July 1, 1891.) MUNICIPAL CORPORATIONS-IMPROVEMENT OF ALLEYS ASSESSMENTS.

The alley in a city block is for the special benefit of the several lots abutting thereon, and under the provisions of subdivision 63, § 68, c. 13a, Comp. St., not to exceed one-half of the cost of paving thereon opposite each lot may be assessed upon such lot. If a lot has been subdivided, then the assessment is to be made upon the several subdivisions upon an equitable and just basis, in proportion to the benefits received." It is not necessary that the subdivision actually abut on the alley in order to be liable for a portion of the tax. The question of the amount of special benefits is one of fact, to be determined from the evidence.

(Syllabus by the Court.)

Appeal from district court, Lancaster county; CHAPMAN, Judge.

Chas. L. Hall, for appellants. E. P. Holmes, City Atty., (J. R. Webster, of counsel,) for appellees.

MAXWELL, J. This is an appeal in equity from the district court of Lancaster county. It is alleged in the petition that "the said plaintiff James F. Lansing is the owner in fee-simple and in possession of lots A, B, and E of subdivision of lots 1 and 2, in block 40, in said city of Lincoln, Lancaster county, Neb. The said plaintiff Adeline R Schoolcraft is the owner in feesimple and in possession of lot C of subdivision of lots 1 and 2, in block 40, in said city of Lincoln. The said plaintiff Mary Geiser is the owner in fee-simple and in possession of lot D, in said subdivision of lots 1 and 2, in said block 40, in said city of Lincoln. That said lots 1 and 2, in said block 40, in said city of Lincoln, were originally each 50 feet in width and 142 in depth, and were bounded on the north by P. street, in said city, and on the south by the alley in said block 40. That prior to the 20th day of September, 1880, said original lots 1 and 2, in said block 40, had been, by Theodore S. Ganter, the owner, sold out in parcels by metes and bounds, at different times, to different parties. That on said 20th day of September, 1880, the then owners of said different parts and parcels of said original lots 1 and 2 did, in accordance with the provisions of section 104 of an act of the legislature of Nebraska, entitled An act to provide for the organization, government, and powers of cities and villages,' approved March 1, 1879, under which said act said defendant was then organized and doing business, make and execute a plat of the subdivision of said lots 1 and 2, in said block 40; and on said 20th day of September, 1880, filed the same for record in the office of the clerk of said Lancaster county, and said plat thereby became a part of the recorded plat of said city of Lincoln, defendant herein, a copy of which said plat of the said subdivision of said lots 1 and 2, in said block 40, is hereto attached, marked Exhibit A,' and made a part of this petition. That said lots A and B, belonging to said Lansing,

plaintiff, and said lot C, belonging to said Schoolcraft, plaintiff, are each 55 feet north, and distant from the north line and nearest point of said alley in said block 40. That said lot E, bel nging to said plaintiff Lansing, and said lot D, belonging to said plaintiff Geiser, are each 25 feet north and distant from the north line and nearest point of said alley in said block 40. That neither said lot A nor B nor C nor D nor E of said subdivision of said lots 1 and 2, in said block 40, belonging to these plaintiffs as aforesaid, is adjacent to or abuts upon said alley in said block 40. That no one of said lots of said subdivision belonging to said plaintiffs, to-wit, lots A, B, C, D, and E, is accessible from said alley in said block 40, and no one of said lots A, B, C, D, and E aforesaid, has access to said alley, and that not said A nor B nor C nor D nor E of said subdivision of said lots 1 and 2, in said block 40, is specially benefited in any sum whatever, or in any manner whatever, by reason of the grading, curbing, guttering, and pav. ing of said alley in said block 40, and cannot use or have any use whatever of said alley in said block 40. That said defendant the city of Lincoln, by its mayor and council, heretofore, to-wit, on or about the 17th day of April, 1887, passed an ordinance creating alley paving districts, and by or dinance passed about April 17, 1887, therein and thereby ordered the grading, curbing, and paving of said alley in said block 40. That in pursuance thereof said alley in said block 40 has been graded, curbed, and paved, but in no place or way whatever does said grading, curbing, or paving of said alley in said block 40 specially benefit the said lots A, B, C, D, and E of said subdivision of said lots 1 and 2, blocks 40, belonging as aforesaid to these plaintiffs, nor abut thereon, and is not adjacent thereto. That thereafter, to-wit, on or about the 23d day of October, 1889, the said defendant the city of Lincoln, by its mayor and council, passed an ordinance levying a special tax and assessment to cover the cost of curbing, grading, and paving said alley in said block 40. That in said last-named ordinance said defendant the city of Lincoln, by its mayor and council, adjudged, determined, and established that said lot A, of said subdivision of said lots 1 and 2, block 40, aforesaid, had been and was specially benefited to the amount of $26.97, by reason of the paving of said alley in said block 40. That said lot B of said subdivision had been and was specially benefited, by reason of paving said alley in said block 40, to the amount of $26.97. That said lot C therein, as aforesaid, had been and was specially benefited, by reason of the paving of said alley in said block 40, to the amount of $26.97. That said lot D therein, as aforesaid, had been and was, by reason of pav. ing said alley in said block 40, specially benefited to the amount of $42.57; and that said lot E, as aforesaid, therein, was and had been specially benefited, by reason of said paving of said alley in said block 40, to the amount of $46.80, and therein and thereby said defendant the city of Lincoln, by its mayor and council, levied and assessed upon said plaintiffs'

said lots, in said subdivision of said lots 1 and 2, in said block 40, to and towards paying the cost of paving said alley in said block 40, as follows, to-wit: Upon lot A therein, belonging to plaintiff Lansing, the sum of $26.97; upon lot B therein, belonging to said plaintiff Lansing, the sum of $26 97; upon lot C therein, belonging to said plaintiff Schooleraft, the sum of $26.97; upon lot D therein, belonging to said plaintiff Geiser, the sum of $42.57; upon lot E therein, belonging to said plaintiff Lansing, the sum of $46.80,-the said tax and special assessment being therein alleged to be the exact special benefit to the said lots so assessed by reason of paving said alley in said block 40. That said plaintiff Lansing for himself alleges that the said special tax and assessment upon his said lots A, B, and E of said subdivision of said lots 1 and 2, in said block 40, aggregating the sum of $100.14, levied upon his said property for and towards paying the cost of paving said alley, in said block 40; and said plaintiff Schoolcraft for herself alleges that said assessment of $26.67 upon her said property above described for paving of said alley in said block 40; and said plaintiff Geiser alleges that said special tax and assessment of $42.57, levied upon her said property above described for cost of paving said alley in said block 40; each plaintiff herein alleges that said assessment upon plaintiffs' property aforesaid, as aforesaid, is utterly ille. gal, and without any authority whatever, and is in conflict with and in violation of the provisions of law relative to grading, curbing, and paving alleys in said city of Lincoln. That said assessment of the property of these plaintiffs for cost of paving said alley in said block 40, in said city as aforesaid, is made upon property not abutting on said alley, and the property aforesaid of these plaintiffs, to-wit, said lots A, B, C, D. and E, of subdivision of lots 1 and 2, block 40, are not specially benefited by the said paving of said alley in said block 40, and said lots belonging to said plaintiffs are not adjacent to said alley aforesaid. That after the passage of said above lastmentioned ordinance a duplicate thereof was on said day made and delivered to defendant Elmer B. Stepherson, treasurer of said city as aforesaid, to which said duplicate the clerk of said city appended a warrant in the usual and due form of law, requiring said treasurer of said city to collect the said pretended special assessment against the said property of these plaintiffs by distress and sale of the goods and chattels of these plaintiffs. If the said special tax and assessments aforesaid should not be paid on or before the time fixed by said ordinance and law for the same to become delinquent, to-wit, the 12th day of December, 1889, that the said Elmer B. Stephenson, treasurer as aforesaid, is required by law to collect said special taxes, and after the same become delinquent, towit, after December 12, 1889, to seize and sell the goods and chattels of these plaintiffs, and, unless restrained by the order of this court, said treasurer defendant will levy upon the goods and chattels of these plaintiffs, and collect said illegal and void special taxes and assessments aforesaid,

D,' and made a part of this answer. (13) That the basis of the assessment of said cost is shown by the resolution of the may. or and council hereto attached, marked 'Exhibit F,' and made a part of this answer. (14) That neither of said plaintiffs, nor did any one in their behalf, ever appear before the said board of equalization, or the said mayor and council, before said tax was levied, and protest against the same, or complain that said assessment was illegal, inequitable, or unjust. (15) That said assessment was duly and regu larly made as provided by law, and that the same is a fair and just apportionment of the cost of said improvement upon the lots benefited, and that plaintiff is now estopped and barred by law from questioning the said apportionment and assessment. (16) That said lots of the plaintiffs are within 150 feet of the alley, and within the limit fixed by ordinance as the depth to which lots should be assessed in said district. (17) That it was determined by the city council, sitting as a board of equalization, that the several lots in each block wherein paving of alleys was done were benefited to the whole amount of the cost of the improvement done in that block as shown by the resolution hereto attached; and the plat showing the location of the several lots in said block 40, and the amount of tax assessed upon, is hereto attached, marked 'Exhibit_E,' and made a part of this answer." The reply is a general denial.

On the trial of the cause, the court found the issues in favor of the defendants, and dismissed the action. Lots 1 and 2, in block 40, in the city of Lincoln, were each originally 50 feet wide, and 142 feet in length. The front is on P street, and they run south to the alley. These lots are subdivided; lot F, 25 feet wide, being cut off from the south end of lots 1 and 2. The remainder of these lots were subdivided, and are known as lots" A," "B," "C," "D, " and "E." In determining the amount of assessment for benefits derived by these several subdivided lots for paving the alley, the mode adopted was to divide the ground between the alley and the street into six parts, and to charge thereon onehalf the cost of paving. The first sixth was charged one-third of half the cost; the next sixth, one-fifth; the next, onesixth; the remaining three subdivisions were charged one-tenth each.

The case of Lamaster v. City of Lincoln, 49 N. W. Rep. 655, involves the same question as that of Lansing v. City of Lincoln. The cases were tried together upon the same evidence, and this decision will cover both cases. Subdivision 63, § 68, c. 13a, Comp. St. 1867, provides that "the council shall have power to open, extend, widen, narrow, grade, curb, gutter, and pave, or otherwise improve and keep in good repair, or cause the same to be done in any manner they may deem proper, any street, avenue, or alley within the limits of the city, and may grade partially, or to the established grade or park, or otherwise improve, any width or part of any such street, avenue, or alley; and may also construct and repair, or cause and compel the construction and repair, of side

walks in such city, of such material and in such manner as they may deem proper and necessary, and to defray the cost and expense of such improvements, or any of them. The mayor and council of such city shall have power and authority to levy and collect special taxes and assessments upon the lots and pieces of ground adjacent to or abutting upon the street, avenue, alley, or sidewalk thus in whole or in part opened, widened, curbed, and gut tered, graded, parked, extended, con structed, or otherwise improved or repaired, or which may be specially benefited by any of said improvements: provided, that the above provisions shall not apply to ordinary repairs of streets or alleys; and one-half of the expense of bringing streets, avenues, alleys, or parts thereof, to the established grade, shall be paid out of the general or road fund of the city.

The provisions of this section in regard to the depth to which the real estate may be charged and assessed shall apply to all special taxes that may be levied, in proportion to the foot front in cities governed by this act.

It is claimed by the appellants that in paving the alley in block 40, along-side of said subdivided lot F, in said block, it was not assessed by the front foot, but by the arbitrary rule of percentages of the cost. In this it is claimed the mayor and council had exceeded their power in levying the assessments complained of. In support of this proposition, the case of Hanscom v. City of Omaha, 11 Neb. 37, 7 N. W. Rep. 739, is cited. In that case the mayor and council of the city of Omaha divided the city into two sewer districts, one district being about 2 miles in length by three-fourths of a mile in width. Contracts were thereupon let for the construction of a main sewer in the channel of a creek in said district, at a cost exceeding $30,000, and assessed all the real estate in the district for its payment. The court held that special assessments could only be levied upon property specially benefited, and only to the extent of the benefits. In that cas there was no attempt to discriminate as to benefits between lots abutting on or specially benefited by the construction of the sewer and those which were high and dry, and received but little, if any, benefit from such construction. In other words, the assessment was not made according to the special benefits on the property assessed, and hence was prohibited by the constitution. While the improvement and paving of an alley is a special benefit to the lots abutting thereon, it does not follow that portions of lots somewhat remote from the alley do not also receive benefits from the improvement. As originally laid out, lots extend from the street to the alley, and necessarily one-half the cost of paving the alley opposite each lot is assessed upon the lot. If the lot is subdivided, the cost is still to be borne by the lot, the mode of apportionment to be based upon some rule that will do justice to the several owners of the subdivided lot. The question as to what constitutes a just and fair proportion of the expense thus incurred is one of fact, to be deter mined from the evidence. The rule adopt