.

The Bankruptcy Act reinforces that authority by providing (§ 2 (15); 11 U. S. C. § 11 (15)) that courts of bankruptcy are invested with jurisdiction "at law and in equity" to "make such orders, issue such process and enter such judgments in addition to those specifically provided for as may be necessary for the enforcement of the provisions of this title." Referring to these statutes, this court has said that "the power to issue an injunction when necessary to prevent the defeat or impairment of its jurisdiction is inherent in a court of bankruptcy, as it is in a duly established court of equity." Continental Bank v. Chicago, R. I. & P. Ry., 294 U. S. 648, 675. Cf. Local Loan Co. v. Hunt, 292 U. S. 234, 240, 241; Kline v. Burke Construction Co., 260 U. S. 226, 229; Looney v. Eastern Texas R. Co., 247 U. S. 214, 221. Jurisdiction to administer the estate draws to itself, when once it has attached, an incidental or ancillary jurisdiction to give protection to the estate against waste or disintegration while frauds upon its integrity are in process of discovery. This power so obviously necessary to the attainment of the ends of justice has been exercised by the lower federal courts in a great variety of circumstances. There have been orders directing payment of moneys into the registry of the court until a plenary suit can be brought to recover them (In re Mitchell, 278 Fed. 707), restraining an adverse claimant from disposing of property in advance of a decree (In re Norris, 177 Fed. 598; Pyle v. Texas Transport & Terminal Co., 185 Fed. 309), and enjoining possessory actions that might jeopardize relief in equity. In re Republic Plumbing Supply Corp., 295 Fed. 573; cf. Blake v. Nesbet, 144 Fed. 279; In re Blake, 171 Fed. 298; In re Nathan Turim, Inc., 55 F. (2d) 672. If suits can be enjoined when they are found to have a tendency to embarrass administration, a fortiori this may be done when there is a basis for the

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fear that they will be used as instruments or devices to render fraud triumphant. Not improbably the order in this case might better have imposed a condition that a plenary suit must be brought within a reasonable time. This defect, if it be one, is now of no importance, for by concession such a suit was brought within a week. There will be no occasion for delay if the corporation, the bankrupt and his family will coöperate in working for a quick decision. In such circumstances there can be no wrong or prejudice to All Continent by postponing its suit in Pennsylvania to a more comprehensive and efficient remedy that will put conflicting claims at rest. Cf. Wehrman v. Conklin, 155 U. S. 314, 329. Delay and expedition will be subject to the control of equity. "In that predicament the malleable processes of courts of bankruptcy give assurance of a remedy that can be moulded and adapted to the needs of the occasion." Brown v. O'Keefe, 300 U. S. 598.

Much of the argument for the respondent has been directed to a showing that the suit in Pennsylvania is not subject to restraint for defect of jurisdiction, and this for the reason that the res to be affected-the securities held by Sparks & Co. in their office in Philadelphia-had not come within the actual or constructive possession of the court of bankruptcy in New Jersey when the suit was begun to remove the cloud upon title. Cf. Fort Dearborn Trust & Savings Bank v. Smalley, 298 Fed. 45; Molina v. Murphy, 71 F. (2d) 605; In re Adolf Gobel, Inc., 80 F. (2d) 849. The argument misconceives the grounds upon which the trustee looks to us for aid. The trustee does not challenge the jurisdiction of the federal court in Pennsylvania, if the word jurisdiction be taken in its strict and proper sense. Cf. Straton v. New, 283 U. S. 318, 321; Isaacs v. Hobbs Tie & Timber Co., 282 U. S. 734, 737, 738. He is not seeking a writ of prohibition directed

to the court itself. He is not seeking an injunction to vindicate his exclusive control over a res in his possession, or in the possession, actual or constructive, of the court that appointed him. Isaacs v. Hobbs Tie & Timber Co., supra; Murphy v. John Hofman Co., 211 U. S. 562, 568, 569; Moran v. Sturges, 154 U. S. 256, 274. What he seeks is an injunction directed to a suitor, and not to any court, upon the ground that the suitor is misusing a jurisdiction which by hypothesis exists, and converting it by such misuse into an instrument of wrong. Gage v. Riverside Trust Co., 86 Fed. 984, 998, 999; Higgins v. California Prune & Apricot Growers, 282 Fed. 550, 557; Cole v. Cunningham, 133 U. S. 107, 112, 117, 118. Suits as well as transfers may be the protective coverings of fraud. Shapiro v. Wilgus, 287 U. S. 348, 355. We are unable to yield assent to the statement of the court below that "the restraint of a proper party is legally tantamount to the restraint of the court itself." The reality of the dis tinction has illustration in a host of cases. 2 Story, Eq. Jur., 14th ed., § 1195; 5 Pomeroy, Eq. Jur., § 2091; Cole v. Cunningham, supra; Madisonville Traction Co. v. Mining Co., 196 U. S. 239, 245; Kessler v. Eldred, 206 U. S. 285; Rickey Land & Cattle Co. v. Miller & Lux, 218 U. S. 258; Toledo Scale Co. v. Computing Scale Co., 261 U. S. 399, 426; Smith v. Apple, 264 U. S. 274, 279. Cf. Judicial Code, § 265; 28 U. S. C. § 379; Brown v. Pacific Mutual Life Ins. Co., 62 F. (2d) 711, 713; Chicago Title & Trust Co. v. Fox Theatres Corp., 69 F. (2d) 60, 61, 62.

The decree of the Court of Appeals is reversed and that of the District Court affirmed.

Reversed.

OHIO BELL TELEPHONE CO. v. PUBLIC UTILITIES COMMISSION OF OHIO.

APPEAL FROM THE SUPREME COURT OF OHIO.

No. 539. Argued April 6, 7, 1937.-Decided April 26, 1937.

1. As bases for an order requiring a telephone company to refund to its patrons "excess" earnings collected during a series of years, a state commission valued the company's property for each of those years by applying to the value in an earlier year, which it had determined on hearings, price trend percentages said to have been derived from evidence of which the commission took judicial notice but which it withheld from its records and refused to reveal. Held a denial of due process of law. P. 300.

2. A fair hearing is essential to due process; without it, there is condemnation without trial. P. 300.

3. Judicial notice may be taken of the fact that there has been an economic depression, with decline of market values; but judicial notice cannot be taken of the values of land, labor, buildings and equipment, with their yearly fluctuations. P. 300.

4. This distinction is the more important in cases where the extent of the fluctuations is not collaterally involved but is the very point in issue. P. 301.

5. Taking of judicial notice has no other effect than to relieve one of the parties to a controversy of the burden of resorting to the usual forms of evidence; his opponent is at liberty to dispute the matter by evidence. P. 301.

6. To press the doctrine of judicial notice to the extent attempted in this case and to do that retroactively after the case had been submitted, would be to turn the doctrine into a pretext for dispensing with a trial. P. 302.

7. From the standpoint of due process-the protection of the individual against arbitrary action-a deeper vice than the unreasonable extension of judicial notice is in this case the concealment from the party affected of the particular or evidential facts of which judicial notice was taken by the commission and on which it rested its conclusion. P. 302.

8. Under the statutes of Ohio no provision is made for a review of the order of the Public Utilities Commission by a separate or independent suit. The sole method of review is by petition in error to the Supreme Court of the State, which considers both the

law and the facts upon the record made below, and not upon new evidence. If, as in this case, that court merely accepts findings of the commission attributed to judicial notice and unsupported by any known or knowable evidence, judicial review is denied. P. 303.

9. In view of the power and discretion reposed in regulatory commissions, the inexorable safeguard of a fair and open hearing must be maintained in its integrity in their proceedings. P. 304. 10. The right to such a hearing is one of the rudiments of fair play assured to every litigant by the Fourteenth Amendment as a minimal requirement. There can be no compromise on the footing of convenience or expediency, or because of a natural desire to be rid of harassing delay, when that minimal requirement has been neglected or ignored. P. 304.

11. The appellant in this case has not estopped itself from objecting to the use of price trends gathered in its absence. P. 306. 131 Oh. St. 539; 3 N. E. (2d) 475, reversed.

Appeal from a judgment sustaining on appeal an order of the Public Utilities Commission of Ohio requiring the Telephone Company to refund "excess earnings" to its patrons.

Messrs. W. H. Thompson and Karl E. Burr, with whom Messrs. W. B. Stewart, Ashley M. Van Duzer, Thomas V. Koykka, and Charles M. Bracelen were on the brief, for appellant.

Mr. Donald C. Power and Mr. W. W. Metcalf, Assistant Attorney General of Ohio, with whom Messrs. Herbert S. Duffy, Attorney General, and A. F. O'Neil, Assistant Attorney General, were on the brief, for appellee.

MR. JUSTICE CARDOZO delivered the opinion of the Court.

The rates chargeable by the appellant, the Ohio Bell Telephone Company, for intrastate telephone service to subscribers and patrons in Ohio are the subject-matter of this controversy.