text:
Crosby v. Buchanan/Opinion of the Court

[Syllabus from pages 420-422 intentionally omitted]

APPEAL from the Circuit Court for the Western District of Virginia. The case was thus:

William King, of Abingdon, a village of Washington County, in the southwest courner of Virginia-a man possessed of valuable brine springs, at Saltiville, close by it, and of other large estate-died in 1808 childless, leaving a wife and eight brothers and sisters; among the brothers one named Samuel, and among the sisters one named Hannah, married to John Allen. He left also a nephew, William King, Jr.

By his will he devised the bulk of his estate, valued at about $500,000, to his nephew (the said William King, Jr.), on a condition which, as things turned out, proved impossible. The fact of the impossibility of the condition led at once to litigation, and in 1830 and 1836, the will in two different suits was the subject of construction in this court.

It was held in the first suit, that the whole estate was devised to William King, Jr. (the nephew), subject to the life estate of the widow, but as it belonged to a court of chancery to determine whether he took the estate to his own use or in trust for the heirs of the testator, that question was left undecided. Accordingly, a bill in chancery was filed to test that question, and in that case, the second one, this court decided that he did take in trust for the heirs.

Samuel King, and Mrs. Hannah Allen, the wife of John Allen, thus each became entitled to an eighth part of the estate. Samuel King lived at Somerset, a place in Pulaski County, in the southeast corner of Kentucky; Allen and his wife at Saltville. The two places were, perhaps, two hundred miles apart.

Independently of any general interest acquired as just mentioned by Samuel King in his brother William's estate, the brother by his will had made a special provision for him thus:

'I leave to the said Samuel, in case of personal application to the manager at Saltville, or to my executors at Abingdon, on the 1st day of January annually, $150. If not called for on that day to be void for that year. Receipt to be personally given.'

The testimony of different witnesses thus described Samuel King.

'He was notoriously and incorrigibly intemperate; though not often in such a condition that he could not go about.'

'I do not recollect that I ever saw him where spirituous liquors were to be had that he did not drink to excess.'

'He was generally intoxicated; that is to say, generally speaking, when I saw him he was so.'

'If I ever saw him sober, I have no recollection of the fact. He was in the habit of constantly drinking.'

This Samuel King, as the testimony further showed, was not only intemperate but was always considered very poor. One witness, Mr. Fox, of Somerset, clerk of the County Court of Pulaski, Kentucky, thus testified:

'To the best of my recollection he was at all times in a manner destitute of any property or credit. I well recollect that he applied to me as often as three times to borrow the sum of $5, each time, as he said, to defray his expenses to Abingdon, Virginia, where he was going to draw his legacy coming to him from the estate of his brother William King, which sums I lent him, he promising to refund the amounts upon his return, which, however, he never refunded.'

Mr. Benjamin Estill, a lawyer, long resident in Abingdon, Virginia, said:

'He was believed to be totally insolvent for three years before his death, which event took place in 1812. I have seen him several times in Abingdon applying for his annuity, and understood that he came on foot from Somerset in Kentucky, where he lived.'Besides being poor and given to drinking spirituous liquor in excess, there was testimony about him thus, and there was no testimony to contradict it.

'I always considered him as a very wild and visionary man, incapable of making bargains to any amount, when he had been drinking, and especially when there was any intricacy in the transaction.'

'I never saw him at any time in a condition when he could contract or trade to any advantage to himself or his family.'

Additional witnesses confirmed this account of him; one saying:

'I never saw him after the death of his brother, that I thought him capable of transacting business of any kind. He ought to have had a guardian, and if he had been in the North would have had one.'

We have mentioned that one of the heirs of William King, of Abingdon, was his sister Hannah, married to John Allen.

Allen's character was thus testified to.

'John Allen's general character as to correctness of dealing in money matters was bad. I am not able to say whether Samuel King was an easy subject for fraud. But Allen's general character was such that he would take advantage of any man if an opportunity offered, and he would do it so smoothly that the person imposed on would consider him a friend.'

'I was well acquainted with John Allen, and knew no good of him. I though him capable of committing frauds of any enormity.'

In addition to these two persons, connected, as we have said, by marriage with one another, and by their common right to participate in the large estate of William King, there appear d a third person, a principal actor in the controversies, the subject of this report. His name was John Vint, and he was entitled 'of Washington City in the District of Columbia.'

Vint was an Englishman, who came to the United States in 1800. His relation to the parties connected with this suit begins about the year 1810, when he is found in intimate relations with Allen; but the mode of origin of his said relation was nowhere distinctly shown, nor with any detail. His name was connected, in the present case, with large transactions. How far property was traced with distinctness as being really his, so as to enable him to purchase in the way, as it will be seen in the sequel, that he alleged he truly did purchase in this case, will appear by the testimony which follows.

'I never saw him till he and John Allen came to purchase a negro girl I owned. I knew nothing of his pecuniary condition. I was acquainted with Allen before. I sold them the girl. They never paid me.'

'In November, 1810, Mr. Vint had a store in the house of Mr. John Allen, and had there a considerable quantity of goods, which were said to be Vint's; but I do not recollect that I ever heard either Allen or Vint say that they belonged to Vint. I was frequently at the store. The shelves were pretty well filled with a good display. I heard it spoken of about that time, that Vint had sold out to Allen. Previous to that time Allen was frequently embarrassed, but as respects the condition of property I am not informed.'

A third witness, Francis Smith, an attorney at law, who had married the widow of William King in 1811, but who testified that he had no interest whatever in the result of the suit, confirmed the view of these two witnesses:

'Previous to September 5th, 1812, there were placed in my hands for collection large claims on Allen. I know that he was hard pressed long before in his pecuniary affairs, and that he was never able to purchase and pay $11,600 for any property. He had nothing, and was able to purchase nothing. About this time I frequently saw both Allen and Vint. They were sometimes in jail and sometimes out. I thought both of them without property or means.'

A fourth witness, one Stout, however, testified in rather an opposite way. He said:

'I recollect the sale by John Allen to John Vint of his interest in the estate of William King, for the sum of about $18,000. I understood from John Allen that at the time of the sale he owed to him, Vint, a small sum, about $2000, and that the balance of the purchase-money was paid by Vint in goods, which Allen afterwards told me he had received. I farther know of my own knowledge that Allen did receive a great many goods from Vint.'

However, as stated, infra (see p. 433), by Vint himself, this sum of $18,000 was not a true consideration.

We now return to Samuel King, already mentioned as intemperate, poor, and visionary. We have stated that he lived in Kentucky and was obliged to come in the beginning of each year, in person, to Saltville or Abingdon, to give his personal receipt for the $150 left to him by his brother's will. He came for the last time in January, 1812, when he claimed payment for two years.

A witness, resident at Abingdon, thus testified:

'When he came to Abingdon, he came to Allen's; Allen kept a public house. He came there drunk, riding a little chunk of a pony, and dressed in a common dress. He was almost always drunk during the time that he was there. When he got to Abingdon he was asked by Allen's family how he had paid his expenses from Kentucky, and whether he had put up at private houses or at taverns? He said that he had put up at any place that he could get in at, and told the persons with whom he put up that he would pay them on his return; for that he would get this year two years' payment. Allen told him that he could get but one, for that he had not come for the last year's payment at the right time, and that under the terms of the will it was go e. Allen's family told me that he was a poor man; and Mrs. Allen, his sister, told him in my presence to return to his family, for that they would suffer in his absence. I thought him to be deranged from intemperance, and this opinion was entertained by the family of Allen generally.'

Having got payment for either one or for two years, King set off on his pony to go back to his home, in Kentucky. He arrived at the house of a man named Pridemore, about sixty miles from Abingdon, to stay all night, and 'while there,' according to the language of a person who saw him, appeared 'during the evening to be very uneasy, going frequently to the door in a state of alarm, and saying that he feared a man by the name of John Allen, and other persons who were following him from Abingdon, and that he would be assassinated.' In the morning his hat and boots, pocket-book and saddle-bags were in his room, but the himself could not be found, and was never again seen or heard of. For some time grave suspicions of murder rested both upon Pridemore and upon Allen. But it finally rather appeared that King had gone out of the house in the middle of the night under the influence of mania a pot u, and wandering through the forests thereabouts had fallen into a rapid stream, swollen by recent rains, and was lost among the gorges of the mountains which rise in that region. The whole matter, however, remained much a mystery.

His pony, saddle-bags, pocket-book, hat, and boots were sent back to his brother-in-law, Allen, by whose wife the saddle-bags and pocket-book were opened and examined. They contained papers but no money.

The unfortunate man himself left, at the time of his death, three children, aged respectively about one, three, and five years.

Allen died not long after, also leaving several children, all young.

We come now more particularly to certain facts of this case.

It seemed plain enough that on the 16th of November, 1810, Allen and wife executed a deed by which, for the professed 'consideration of $18,901.27, current money, to them in hand paid,' they conveyed to Vint all the right and interest which the said Allen, in right of his wife, and also which his said wife had in the estate of the said William King, that is to say one-eighth part of that estate; and also a certain fifth part of the eighth of the estate which came to Samuel King as one of the heirs, which fifth the deed recited that the said Samuel had conveyed to Allen, who was to reserve it as a compensation to counsel, for services in the suits already mentioned at the beginning of the report of this case (page 422), brought to establish in effect an intestacy, and the rights of the heirs.

This deed had apparently been witnessed on the day of its date, November 16th, 1810, in the ordinary way, by three witnesses; but was not then acknowledged, proved, or recorded. On the 27th of April, 1812, fifteen months after the date of its execution, and as was specified on it, 'at the request of Allen,' its execution was attested de novo by two other witnesses. On the 7th of May following, it was proved for record in the way required by the laws of Virginia.

The scrivener who drew the deed testified that he drew it carefully; the transaction being large; but that he knew nothing about the true considerating of it.

It seemed further, plain enough, that on the 1st of January, 1811, Samuel King had executed a deed by which, for the professed 'consideration of the sum of $10,000 to them in hand paid,' he and his wife had transferred to this same Vint four-fifths of their interest in the estate of William King, brother of the said Samuel; the remaining fifth having, as the deed declared, been conveyed by them to Allen, in the way already mentioned, as compensation to counsel, in attending to the suits to establish the rights of the heirs.

The wife's execution of this deed, as it was produced, was by a mark. The execution of this deed was not witnessed, nor did the deed itself state where it had been executed, that is to say, whether in Virginia (at Abingdon or Saltville), where Allen lived, or at Somerset, in Kentucky, where King and his wife, the grantors, lived. But it appeared that on the 29th of January, 1811, that is to say twenty-eight days after the day stated in the instrument as the date of its execution, the instrument had been acknowledged by King and his wife in Somerset, Kentucky, where King and his wife lived, and by King then given to the recorder there for record, and afterward by the recorder returned to King; Vint not anywhere appearing in this transaction.

Pulaski County, in Kentucky, in which State the lands conveyed by this deed did not lie, was not the proper place for the record of the deed of King and wife to Vint. The deed was not proved in Washington County, Virginia, where the lands did lie, till the 25th of September, 1837.

With this statement by way of proscoenium, we will now state the pleadings and further developments in the case:

In January, A.D. 1825, during the pendency of the litigation in some of its forms, about the estate of the original owner of it, William King, who, as we have already said, died in 1808, a bill was filed in the Circuit Court of the United States by some of the heirs to obtain a partition of the lands not incumbered by the widow's life estate, and on the 25th of April, 1836, after the last of the decisions in this court, an order was entered appointing commissioners to make this partition. These commissioners afterwards made a report, and, among other things, assigned to the children and heirs of Samuel King, and the children and heirs of Hannah Allen, the wife of John Allen, one-fourth the property divided.

On the 24th of September, 1838, Vint filed an original bill against the heirs of Samuel King and the heirs of Allen and wife, in which he set forth substantially that each had become owners of one-eighth of the estate of William King, of Abingdon, and then alleged that he was the owner in fee of their interest in the estate. He stated that his title to the Allen interest and one-fifth of the King interest was obtained by the already mentioned deed from Allen and wife, dated November 16th, 1810, in which, for the consideration of $18,901.27, they conveyed the same to him; and that his title to four-fifths of the King interest was by the already-mentioned deed from King and wife, dated January 1st, 1811, in consideration of $10,000, executed and recorded in Kentucky. Of both these deeds, their tests, probates, &c., he appended copies to his bill. But he appended nothing else; nor did he state or intimate in the bill, or by anything appended to it, that the transactions were in reality in the least other or different than what a reader would infer from reading the two instruments themselves. He stated rather, on the contrary, that he did not desire a suspension of the proceedings in partition any further than was necessary to protect his rights, and that he was willing to accept the lands set off to the heirs as and for his share. And the prayer of the bill was to the effect that he might be substituted for these heirs in the partition proceedings, and that whatever was assigned to them might be adjudged to him.

In September, 1839, all the defendants answered the bill, and in substance stated that they were every young when the transactions referred to occurred, and that they had no personal knowledge as to the matters in controversy. They denied generally all the allegations in the bill adverse to their interests, and suggesting many serious grounds of suspicion against the validity of the claim of Vint, demanded from him full and express proof of all the material averments of his bill, and expecially for proof of the fairness of the deeds, and of the full payment of the consideration thereof, and of the circumstances of the execution of the deeds and the alleged payments. The death of the widow of William King, the original owner, was also suggested, and the heirs of Samuel King stated that they ad conveyed their interest to a certain Findlay.

On the 19th of September, 1839, Vint filed his supplemental bill, making Findlay a party, and also alleging the death of the widow, and asserting his right to the interest of Samuel King and Hannah and John Allen in the property devised to her for life and assigned to her for dower. In this supplemental bill he stated as follows:

'Your orator cannot suppose that it will be necessary for him to allege or prove the payment of the consideration, acknowledged in solemn form by the parties to said deeds, until the fairness of the transaction and fulness of consideration are impugned by proof; but your orator asserts the payment of a full and fair consideration for their interests, which were then wholly contingent. Indeed, your orator was reduced from affluence to poverty by this very consideration paid for said interests. The deed from Allen and wife was duly admitted to record in the Circuit Court for Washington County, Virginia, on the 7th day of May, 1812, and the deed from Samuel King was duly admitted to record in the County Court of Pulaski County, Kentucky, where said Samuel King resided, on the 29th day of January, 1811, and on the 25th day of September, 1837, upon proof of the genuineness of said King's signature, the said deed was admitted to record in the County Court of Washington County, Virginia. . . . Your orator did not deem it necessary to prosecute his claim by suits until the suits should be determined in which the question was made whether William King, son of James King, took under the will of William King as devisee of his real estate, or whether it descended and passed to his heirs at law. It was, moreover, useless, and would have been premature to have asserted your orator's claim in the salt works and dower property until the life estate should be determined. Your orator is advised that he has been guilty of no laches from lapse of time, since he is in full time for the partition, which has not yet been made of any part of the estate.'

To this supplemental bill Findlay answered, setting up his title under the conveyance from the heirs of Samuel King, and insisting upon several defences not now material to be stated.

After the filing of the supplemental bill much testimony was taken. On the 7th of February, 1840, Francis Smith, who married the widow of William King, the original owner, gave his deposition, and in it furnished a copy of a contract, as follows:

'This agreement, entered into this 6th of April, in the year of our Lord 1812, between John Allen, of the county of Washington, in the State of Virginia, of the one part, and John Vint, of the city of Washington, in the District of Columbia, of the other part, witnesses that the said John Vint, for and in consideration of the sum of $14,450, to be paid the said John Allen in the manner hereinafter mentioned, the said John Vint doth covenant and agree to transfer, make over, and convey to the children which the said John Allen now has and to such other children as he may have with his present wife Hannah, one-half of all the interest which he, the said John Vint, may have in the estate of William King, deceased, by a conveyance from John Allen and Hannah, his wife, bearing date the 16th of November, 1810, and also by another conveyance from Samuel King and his wife, bearing date the first day of January, 1811, reference thereto being had will more fully appear. It is further agreed that the said John Allen and the said John Vint shall contribute equal portions of the expenses which may necessarily be incurred in the prosecution of suits for the recovery of the estate aforesaid; but until the payment by the said John Allen to the said John Vint of the sum of $14,450, the said John Vint shall not be compelled to convey one moiety of his interest in the estate aforesaid to the children of the said John Allen by his present wife Hannah; and should the said John Allen fail to make the payment to the said John Vint of the sum aforesaid, for and during the term of five years from this date, then, and in that case, it is further agreed between the parties that this agreement shall be void and of no more effect than if it had not been entered into. Whereunto we have set our hands and fixed our seals the day and year above specified, in the presence of—

'JOHN ALLEN. [SEAL.]

'JOHN VINT. [SEAL.]

'M. SHUGART.

'DAVID STOUT.'

And afterwards a receipt as follows was discovered:

'Received of John Allen the sum of $11,600, it being in part pay of a contract entered into, it bearing date the 6th day of April, 1812, it being on account of the estate of the deceased William King. It being for the benefit of the said Allen's heirs, the 7th April, 1812.

'$11,600.

'JOHN VINT.'

This same witness, Francis Smith, testified further that having heard from Vint that John Allen, with whom he, Smith, had a quarrel, was about to perpetrate through forgery a fraud upon him, he got Vint to make a certain affidavit. This affidavit was annexed to Smith's deposition, and, in the part material to this case, was thus:

'This day came John Vint before me, John Gibson, a justice of the peace for Washington County, Virginia, and made oath, that on the 16th November, 1810, he purchased from John Allen all his interest in the estate of William King, deceased, and after that purchased from said Allen all the interest of Samuel King in said estate, for which he was to have given, and did give, said Allen credit on a debt due from him to his affiant for $10,000; but that said Allen then stating that he wished the receipt executed by this affiant to be for a larger sum than the sum really given in order to promote his credit to the northward by the largeness of the payment he was making his creditors, this affiant agreed thereto, and executed his receipt for about $8000 more than the sum he was to give. Thus the business stood until April, 1812, when this affiant entered into another contract with said Allen in writing of that date, by which contract he sold and agreed to convey to the children of John Allen, by his wife Hannah, one-half of all his interest in William King's estate upon the payment by John Allen to this affiant of $14,000.

'JOHN VINT.

'Subscribed and sworn to before me this 5th September, 1812.

'JOHN GIBSON.'

Other testimony was from time to time taken in the cause, and finally, in December, 1842, the heirs of Hannah and John Allen filed their cross-bill, in which they stated, that since the filing of their answers they had learned other facts most material in their character, and having an important bearing upon their rights and interests. They averred that these facts, 'though necessarily well known to complainant (Vint), since he was an actor, and is the only surviving actor in the transaction, he has thought fit, from motives which cannot easily be misunderstood, to suppress.' After referring to their extreme youth at the time the transactions occurred, and other circumstances likely to prevent their becoming acquainted with the facts, they set forth the foregoing contract and receipt, which had then recently been discovered in their search after the truth of the case. They then charged that the failure of Vint to bring these matters to the knowledge of the court was such a fraud on them as must deprive him of the aid of a court of conscience in the premises, and claimed that under the circumstances of this case the payment of the balance of the purchase-money due upon the contract should be presumed. They prayed:

1st. For a cancellation of the deed from Allen and wife to Vint; or,

2d. If that could not be granted, a specific performance of the contract; or,

3d. A return of the purchase-money shown by the receipt to have been paid.

To this cross-bill Vint answered in September, 1843. He denied all charges of fraud and improper suppression of truth, and then said:

'The respondent fairly purchased and paid for the interest of John Allen and Hannah, his wife, and of Samuel King, in the estate of W lliam King, deceased, and by deeds duly executed the said parties regularly conveyed their interest to him. For these deeds reference is here made to the exhibits filed by this respondent to his original bill. Some time after these purchases and the execution of said conveyances, it is true that this respondent did make with John Allen the contract of the 6th of April, 1812 (given, supra, pp. 431-2), but Allen did not pay him the purchase-money within five years, or at any time, and having failed to do so, the contract became void. He admits the execution of the receipt, and alleges that beyond this there could be no pretence of any payment. He denies that he received all the money mentioned in that. He recollects distinctly that as part of the sum embraced in the receipt, a draft on John Jelf for $2333 was included, and that it was protested and never paid. A part of the sum also was made up of debts of Vint, which Allen assumed to pay for him but never did pay.'

'The contract on which the $11,600 aforesaid purports to have been paid and the receipt for that sum, were not retained by this respondent in his hands, as the complainants would seem to indicate, but were handed over to John Allen; and as the said Allen and his heirs are interested in the said papers, this respondent supposed that they would take care of them, and at all times have them at their command. This respondent has certainly never had the said papers under his control, and this having been the case, it seems extraordinary to him that the complainants should gravely charge him with improperly concealing contracts and papers which they must have known were never in his possession.'

On the 17th of April, 1844, Findlay filed his cross-bill against Vint, in which he asked that the deed from Samuel King to Vint might be set aside for fraud. In this bill he charged that the deed was obtained by the fraudulent combination of Vint and John Allen to divest King of his interest in the estate, and stated that proof had already been made in the case that Vint had said he purchased this interest from Allen. He then stated that the actual consideration for the deed was $6000, payable in ten equal annual instalments, for each of which a note was given. That none of these notes had been paid, and that Vint had nine of them in his possession. He charged that they were unfairly obtained by Vint, and probably in consequence of his dealings and combination with Allen. He called for an answer under oath.

To this cross-bill Vint filed an answer on the 8th of April, 1845, in which he adopted as part of it the answer which he had before filed to the cross-bill of Allen's heirs. He denied that the deed to him was obtained by fraud. He said that he could not undertake to say with certainty whether or not John Allen exerted any material agency in bringing about the sale by King, but denied all fraudulent combination for that purpose. He admitted that no money had been paid by him to King, and that the consideration was as stated in the cross-bill, and he appended copies of the ten notes. All of them were payable in negroes, in Abingdon, at cash price. The three first falling due were payable to King, or his order. The others to the children of King by Patsey, his wife. The execution of all was witnessed by John Allen. A receipt as follows was produced and made part of his answer:'January 1st, 1811. Received of John Vint three notes, each $600, and seven notes to my heirs, each of them $600, and likewise a conveyance of all my right and title to the estate of my deceased brother, William King. Now, let it be understood, that I am to forward to John Allen, of Abingdon, said conveyance to said Vint, all my right and title to said estate, legally and completely done by me and my wife, or else said notes, in number, ten, amounting to $6000, payable by instalments, as the said notes will show, all of them and each of them to be void and of no effect if the conveyance is not forwarded in three months. If so the n tes to be good.

'SAM. KING.

'Attest: JOHN ALLEN, HANNAH ALLEN.'

He then said that in pursuance of this agreement King did execute the deed in Kentucky, and that under it he claimed title. He then said that Allen procured from King nine of the ten notes and delivered them to him, and that the amount of these notes was included in the receipt for $11,600, stated on p. 432, as part pay of the contract between himself and Allen, of the 6th of April, 1812; and that he received the notes in good faith from Allen, supposing that Allen had obtained them fairly from King. The notes were yet unindorsed by any one.

One of them-one of the three payable to King, and the one that first fell due-was assigned by indorsement made on it by King, and dated January 2d, 1811, to Allen, and by him to one Sheffey, who had been counsel for the heirs in their suits about the property of William King.

He appended to his answer three exhibits intended to show the state of accounts between him and Allen, April 6th, 1812. They are not necessary to understand the case as relied on by the court, which rests its judgment, as will be seen hereafter, on the leading facts of the case already disclosed. But they are specially adverted to in the argument of counsel for the defendants-the heirs of Mrs. Allen-who relied not only on the leading facts of the case but on the details of it, which, as they conceived, explain and heighten the effect of the leading facts. They are, therefore, here inserted:

ABINGDON, April 6th, 1812.

JOHN ALLEN TO JOHN VINT, DR.

To my note given to Francis West, for.... $300

Interest up till this date,............... 42

Do. three notes: one to J. Harper, one to R. Preston, and one

to J. McCrab, amounting to $1133.34, which I lent my

name for. At that time Mr. Allen had the money in his

own hand,............................... 1133

Interest on the above,.................... 56

''Do. one note of mine which gave to Mr. Allen in favor of Samuel''

King for $600, which I paid Mr. Allen, 1st June, 1811; the

said note was due the 1st day of January, 1812,. 600

Interest on the above note,............... 34

Do. I paid Mr. Allen the sum of.......... 166

title: Crosby v. Buchanan/Opinion of the Court


text: Talk:Crosby v. Buchanan/Opinion of the Court

license: Creative Commons - Attribution Share-Alike - https://creativecommons.org/licenses/by-sa/4.0/


text:
The Rio Grande (90 U.S. 458)

APPEAL from the Circuit Court for Louisiana; the case being thus:

In October, 1866, one Williams, a steamboat captain, purchased in New Orleans, a steamboat called the Rio Grande, and took her to Mobile, Alabama. He there mortgaged her to Stewart and Ross; and employed her in running between certain towns at the upper and lower parts of Mobile Bay; he, Williams, and not the mortgagees having possession. While she was thus employed, Otis and others, in November, 1867, libelled her in the District Court for Alabama for repairs. The libels alleged that the steamer was owned by persons out of the State of Alabama, and belonged to some port in the republic of Mexico, and that the repairs had been made on the credit of the vessel.

Williams as owner, and Ross and Stewart as mortgagees, intervened, denying that the repairs had been made on the credit of the vessel. They asserted, contrariwise, that the repairs had been made on the credit of Williams. They denied also that the vessel was a foreign vessel, or had been at any foreign port after her arrival at Mobile; asserting, contrariwise, that she was a domestic vessel engaged in running in the internal waters of the State of Alabama.

In point of fact, the evidence tended to show that the vessel had been originally a vessel of war (then named the Susanna), built for the rebel confederacy; that she had been captured during the rebellion by a vessel of the government, sent into Philadelphia and there condemned, and sold as prize to one Hazard, an American citizen, on the 13th of January, 1865; that Hazard sent her to Matamoras in Mexico, under the command of one Tyler, and had given him power to make sale of her; that for commercial purposes she was put under British colors, with a temporary British registry, which expired while she was at Matamoras; that while there she could leave the port in no other way than by obtaining a temporary Mexican registry, which was done by putting her in the name of Francisco Alcala, a citizen of Mexico, residing in New Orleans, under which Tyler brought her to New Orleans; that all this was done for special purposes, but that the vessel all the while was in reality the property of an American citizen; that after Williams brought the vessel to Mobile he was not allowed to register her there as his own vessel, she being held under a Mexican registry; and, finally, that the collector gave her a temporary permit and license, on the 12th day of June, 1867, to run in Mobile Bay and River, and referred to Washington for settlement the question whether she should be enrolled.

The court referred it to a master to determine whether there had been a credit to the vessel, and if so whether the vessel was a foreign one.

The master recapitulated leading facts as he conceived them on both sides, bearing on the national character in law of the vessel, some of which are above given-adding that several of the witnesses swore that Captain Williams had told them repeatedly that the vessel was bound for their wages; that she was a foreign vessel, having Mexican owners; but that Williams himself swore that he never told the libellants that they had a lien, and never represented the vessel as being in point of fact owned by any one but himself; though he had spoken of her Mexican registry.

The District Court for Alabama, on the whole case, was in favor of the claimants, that is to say, it considered that the debts set forth in the libels did not constitute a maritime lien so as to give the court jurisdiction, and dismissed the libel. This was on the 11th of May, 1868.

At the time that this decree of dismissal was rendered, and within a few minutes thereafter, a motion was made to the judge holding the court, that an appeal from the decree be allowed. The motion was granted, and an order was then and there made fixing the amount of the bonds to be given on the appeal.

On the next day-that is to say, on the 12th of May-the vessel being still in the custody of the marshal, owing to the fact of some clerical irregularity about the motion for the appeal, the proctor of Stewart and Ross asked for and obtained from the court an order of retention of the vessel to them, and the marshal having surrendered her to them accordingly they immediately carried her out to sea, and went off with her. The libellants, nevertheless, on the 14th and 15th of the month gave their appeal bonds in form, and they were duly accepted by the clerk.

On the case being heard by the Circuit Court, that court reversed the decree of the District Court and decreed for the libellants; holding thus both that the credit had been given to the vessel, and that the vessel was to be regarded as a foreign one. But the vessel was no longer in the marshal's possession to answer. The res had departed.

However, she was soon heard of at New Orleans, and the libellants instantly sent, and, libelling her there, seized and held her anew. To their libel they appended the record of the proceedings in the District of Alabama.

The Ocean Towboat Company now intervened-a company which, in September, 1869, had acquired the right of the old owner, Captain Williams, and of his mortgagees, Stewart and Ross; the right of whom had passed in some way to a Mrs. Price.

This company set up in answer to the new libel,

1st. That, at the time the libellants took their alleged appeals from the decree of the District Court for Alabama dismissing their libels, as also at the time the Circuit Court for the State just named rendered the decree now invoked, the steamer Rio Grande, proceeded against in rem, was neither in the actual nor in the constructive possession of either the District or the Circuit Court; but that, on the contrary, the vessel had prior thereto been restored to the claimants, Ross and Stewart, by virtue of the decree of the District Court.

2d. That from the circumstances of the case, the claimants could have nothing to urge against the libels in the said District Court of Alabama, their ownership of the Rio Grande having accrued long after the proceedings in that court had terminated, to wit, in September, 1869, and outside of the jurisdiction of the said court, to wit, in New Orleans.

3d. That all the proceedings had in said Circuit Court for Alabama, in the matter of the said alleged appeals, were ex parte, irregular, and in violation of the rules, usages, and laws of the admiralty, regulating the subject.

That as the libellants had failed to move that court to set aside the decree of restoration heretofore mentioned, or to appeal from the same; and as by reason of their laches in this regard, they had suffered the decree to be carried into effect by the marshal, they must be taken, notwithstanding their form and show of an appeal, as having acquiesced in the execution of the judgment of the District Court dismissing their libels for want of jurisdiction.

4th. That the vessel was a domestic vessel, and, therefore, not liable to a lien for repairs done to her in her home-port, whether credit was given to her or not.

The District Court dismissed the libel filed there, as the District Court of Alabama had done by the libel filed in it. On appeal, however, the Circuit Court reversed-as the Circuit Court of Alabama had done by the decree of the District Court for that district-the decree of the inferior court, and decreed in favor of the lien. The Ocean Towboat Company appealed.

It may be well here to say that the Judiciary and subsequent acts enact, in regard to appeals in admiralty from the District Court to the Circuit Court, that upon sufficient security and service of notice being given, within a certain time, to prosecute them with effect, the appeal shall be a supersedeas and stay execution. The security and notice, it seemed plain, had been duly given in this case.

Mr. D. C. Labatt, for the appellants, the Ocean Towboat Company; Mr. P. Phillips, contra.

Mr. Justice HUNT delivered the opinion of the court.

title: The Rio Grande (90 U.S. 458)


text: Talk:The Rio Grande (90 U.S. 458)

title: Talk:The Rio Grande (90 U.S. 458)


text:
The Rio Grande (90 U.S. 458)/Opinion of the Court

The appellants insist that at the time the libellants took their appeal from the decree of the District Court of Alabama, the vessel proceeded against in rem was not in the actual or constructive possession of the District or Circuit Court, but that she had been previously restored to the claimants by virtue of an order of the District Court, under which the marshal could justify.

But the appeal which was allowed by that court on the 11th of May, operated as a stay of all proceedings upon or under the judgment of dismissal of the libels made on that same day, and but a few minutes before. The appeal was well allowed, the bonds are in compliance with the order of the court so far as it appears, were accepted by the clerk, and were not objected to by the parties. We cannot agree with the argument of the claimant that under such circumstances the Circuit Court in Alabama had no jurisdiction of the appeal, and that its decree was void.

The appeal stayed all proceedings, and the parties were bound to keep the vessel where it then was, to wit, in the possession of the court. The appeal was taken and allowed before any order of discharge was granted, and the bonds required to make the appeal a stay of proceedings were given within the time required by the statute.

The removal of the vessel pending an appeal to the Circuit Court will illegal, in violation of the express directions of the statute regulating appeals.

We do not understand the law to be that an actual and continuous possession of the res is required to sustain the jurisdiction of the court. When the vessel was seized by the order of the court and brought within its control the jurisdiction was complete. A subsequent improper removal cannot defeat such jurisdiction. The present claimants are not bon a fide purchasers, setting up new interests. They are purchasers only of such in erest as passed under the claims of Mrs. Price and Mr. Williams. This was the very title set up, litigated, and decided in the Alabama suit. It cannot again be interposed and litigated a second time, as a defence to that decree.

In Cooper v. Reynolds, the court say: 'Jurisdiction of the res is obtained by a seizure under process of the court, whereby it is held to abide such order as the court may make concerning it. The power to render the decree or judgment which the court may undertake to make in the particular case depends upon the nature and extent of the authority vested in it by law in regard to the subject-matter of the cause.'

In the case of The Brig Ann, Chief Justice Marshall says: 'In order to constitute and perfect proceedings in rem it is necessary that the thing should be actually or constructively within the reach of the court. It is actually within its possession when it is submitted to the process of the court; it is constructively so when by a seizure it is held to ascertain and enforce a right or forfeiture which can alone be decided by a judicial decree in rem. . . . Before judicial cognizance can attach upon a forfeiture in rem under the statute there must be a seizure, for until seizure it is impossible to ascertain what is the competent forum. And if so, it must be a good subsisting seizure at the time when the libel or information is filed or allowed. If a seizure be completely and explicitly abandoned and the property restored by the voluntary act of the party who has made the seizure, all rights under it are gone. It is not meant to assert that a tortious ouster of possession, a fraudulent rescue or relinquishment of her seizure will divest jurisdiction. The case put is that of a voluntary abandonment and release of the property seized, the legal effect of which must be, we think, to purge away all the prior rights acquired by the seizure.'

In Taylor v. Carryl, the rule is thus laid down: 'In admiralty all parties who have an interest in the subject of the suit, the res, may appear, and each may propound independently his interest. The seizure of the res and the publication of the monition or invitation to appear is regarded as equivalent to the particular service of process in law and equity. But the res is in no other sense than this the representative of the whole world. But it follows that to give jurisdiction in rem there must have been a valid seizure and an actual control of the ship by the marshal of the court; and the authorities are to this effect. In the present instance the service was typical. There was no exclusive custody or control of the bark by the marshal from the 21st day of January, 1848, to the day of sale, and when the order of sale was made in the District Court she was in the actual and legal custody of the sheriff.'

We hold the rule to be that a valid seizure and actual control of the res by the marshal gives jurisdiction of the subject-matter, and that an accidental or fraudulent or improper removal of it from his custody, or a delivery to the party upon security, does not destroy jurisdiction. In the present case the order for restoration was in direct violation of the statute regarding appeals, and did not operate to destroy the jurisdiction of the Circuit Court. That court was authorized to proceed as if no such order had been made.

It is further insisted by the appellants that the Circuit Court in Alabama had no authority to render its decree, for the reason that the subject-matter, to wit, materials and repairs to a vessel in a domestic port, gives no ground of jurisdiction. There are several answers to this suggestion:

1. We do not know that the facts are as alleged in the objection. Supplies were furnished and repairs were made, but whether the vessel was an Am rican or a foreign vessel we have no means of determining. The report of the master makes reference to various matters which would authorize a determination either way, but the testimony itself is not given. Until a short time before the furnishing the materials the vessel had been a Mexican vessel, and the claimant had repeatedly stated that she was a foreign vessel, but how the fact was we have no legal means of determining.

2. Whether the vessel was foreign or domestic was one of the questions presented to the Circuit Court and passed upon by it, and conclusively.

3. If there was error in the decision on this point it was error only, and not an excess of jurisdiction. The vessel was in possession of the court when the suit was commenced. It was the duty of the court to decide whether the proceeding should be in rem or in personam, and until reversed its decree on this question is conclusive.

The judgment and decree of the Circuit Court in Alabama, that the vessel was subject to the lien of the libellants' claim, remaining in full force, was conclusive of the right of such claim when alleged in the District of Louisiana. The judgment of the Circuit Court to that effect was right, and must be

AFFIRMED.


text: Talk:The Rio Grande (90 U.S. 458)/Opinion of the Court


text:
Lewis v. Cocks

APPEAL from the Circuit Court for Louisiana.

In March, 1863, Anderson, alleging himself to be a creditor to the extent of $8840 of one Cocks, filed a petition in the 'Provisional Court of New Orleans'-a court established by proclamation of President Lincoln during the rebellion (while New Orleans was occupied by the troops of the United States), and of which a full account is given in preceding cases -that Cocks, then absent from the State, and a certain Hyllested, who the petition alleged was the proper agent of Cocks in the matter of a proceeding like the one embraced by the petition, might be cited to appear, and after proceedings had, be condemned to pay the amount for which Anderson, as already said, alleged himself to be a creditor.

The Provisional Court gave judgment by default for Anderson, and execution having issued, two houses and lots, the property of Cocks, were sold to a certain Izard, to whom possession, which he still had, was delivered by the marshal of the court.

Hereupon-Anderson having died and administration having been granted on his estate-the rebellion also being ended and the regular courts of the United States re-established-Cocks filed, A.D. 1866, a bill in equity in the court below against Izard, praying that the defendant might be decreed to execute in favor of the complainant a deed for the property on receiving the price paid by the defendant for the same.

The relief was prayed for on the grounds—

1. That the Provisional Court was a nullity and its judgment against Cocks void.

2. That no service of process had been made upon Cocks; that no sufficient service had been made upon Hyllested, the agent of Cocks, and that Hyllested was not such an agent as that valid service could be made upon him.

3. That Izard was guilty of a gross fraud touching the sale of the property by the marshal; that he professed to be the friend of Cocks, and to intend to buy in the property for him; that he thus deterred others from bidding and himself bought the property at a sacrifice; that subsequently he acknowledged to Cocks his fiduciary relation to the property, and expressed a willingness to surrender it, but that finally his cupidity got the better of his integrity, and impelled him to deny that Cocks had any right whatever to the property, and that he now claimed it as his own.

The bill tendered back the purchase-money paid to Izard with interest.

Izard answered and denied all the material allegations of the bill. He also set up that he had mortgaged the property to Lewis; that it had been seized and sold under that mortgage; that Lewis became the purchaser, and that his, Izard's, entire title had thus become divested out of him and vested in Lewis.

Lewis also answered, setting up the same facts as to his title as had been stated by Cocks, and making the same denials as to the averments of the bill. He was accordingly substituted as defendant.

On the hearing, the great weight of evidence appeared to show that the fraud alleged against Izard had not been committed by him.

The Circuit Court, however, decreed in favor of the complainant, and Lewis took this appeal.

Mr. P. Phillips, for the appellant, after observing that the question as to the constitutionality of the Provisional Court was not longer open, contended that the case was nothing more in fact than a claim by a man out of possession (the complainant) for real estate of which another man (the defendant) was in possession; that to establish such a claim ejectment (which this proceeding was not) was the proper remedy, and a bill in equity (which this proceeding was) an improper one. That even if proper service had been made the bill was demurrable, and that therefore the question of service was of no importance. It might be admitted to have been well made, still the bill should have been dismissed.

Mr. Conway Robinson, contra, submitted that if fraud were disproved, a question of account growing out of the matter of purchase-money was still involved-in addition to the demand for the land-making equitable relief the most convenient and complete relief; that, at all events, the objection not having been profited of by demurrer or other proper pleading, could not now be taken advantage of. He also went into a quotation and examination of the Code of Louisiana to show the insufficiency of the service.

Mr. Justice SWAYNE delivered the opinion of the court.

title: Lewis v. Cocks


text: Talk:Lewis v. Cocks

title: Talk:Lewis v. Cocks


text:
Lewis v. Cocks/Opinion of the Court

The question of the validity of the Provisional Court is not an open one. We have held it valid upon more than one occasion when the question has been before us.

The fraud charged upon Izard is expressly denied by his answer and is not sustained by the evidence. There is a decided preponderance against it. We are unanimous upon the point. It could serve no useful purpose to examine the proofs in detail in order to vindicate our judgment. Nothing further need be said upon the subject.

The remaining part of the case is that which relates to the allegations of the non-service of process.

In considering the bill, we must regard it as being just as it would be if it contained nothing but what relates to this subject. Everything else must be laid out of view. It must be borne in mind that the complainant is not in possession of the property.

If the bill alleged only the nullity of the judgment, under which the premises were sold, by reason of the non-service of the original process in the suit, wherefore the defendant had no day in court, and judgment was rendered against him by default, and upon those grounds had asked a court of equity to pronounce the sale void, and to take the possession of the property from Izard and give it to the complainant, could such a bill be sustained? Such is the case in hand. There is nothing further left of it, and there is nothing else before us. Viewed in this light, it seems to us to be an action of ejectment in the form of a bill in chancery. According to the bill, excluding what relates to the alleged fraud, there is a plain and adequate remedy at law, and the case is one peculiarly of the character where, for that reason, a court of equity will not interpose. This principle in the English equity jurisprudence is as old as the earliest period in its recorded history.

The sixteenth section of the Judiciary Act of 1789, enacting 'that suits in equity shal not be sustained in either of the courts of the United States in any case where plain, adequate, and complete remedy may be had at law,' is merely declaratory and made no change in the pre-existing law.

To bar equitable relief the legal remedy must be equally effectual with the equitable remedy, as to all the rights of the complainant. Where the remedy at law is not 'as practical and efficient to the ends of justice and its prompt administration,' the aid of equity may be invoked, but if, on the other hand, 'it is plain, adequate, and complete' it must be pursued.

In the present case the objection was not made by demurrer, plea, or answer, nor was it suggested by counsel, nevertheless if it clearly exists it is the duty of the court su a sponte to recognize it and give it effect.

It is the universal practice of courts of equity to dismiss the bill if it be ground upon a merely legal title. In such case the adverse party has a constitutional right to a trial by jury.

Where the complainant had recovered a judgment at law and execution had issued and been levied upon personal property, and the claimant, under a deed of trust, had replevied the property from the hands of the marshal, and the judgment creditor filed his bill praying that the property might be sold for the satisfaction of his judgment, this court held that there was a plain remedy at law; that the marshal might have sued in trespass, or have applied to the Circuit Court for an attachment, and that the bill must therefore be dismissed.

In the present case the bill seeks to enforce 'a merely legal title.' An action of ejectment is an adequate remedy. The questions touching the service of the process can be better tried at law than in equity. If it be desired to have any rulings of the court below brought to this court for review, they can be better presented by bills of exception and a writ of error than by depositions and other testimony and an appeal in equity.

There is another important point, which we have not overlooked. It is whether the judgment of the Provisional Court can be pronounced a nullity without the legal representative of Anderson, the deceased plaintiff, being before the court as a party. As the first objection is a fatal one we have not considered that question.

DECREE REVERSED, and the case remanded with directions

TO DISMISS THE BILL.

title: Lewis v. Cocks/Opinion of the Court


text: Talk:Lewis v. Cocks/Opinion of the Court


text:
Grand Tower Company v. Phillips

ERROR to the Circuit Court for the Southern District of Illinois; in which court Phillips & St. John, partners, sued the Grand Tower Company-a mining, manufacturing, and transportation corporation of Illinois-to recover damages for breach of contract.

The declaration set forth that the company, on the 15th of December, 1869, entered into a written contract with the plaintiffs to deliver to them at the company's coal-dump, at Grand Tower, in Jackson County, Illinois, on the Mississippi River, and about eighty miles above Cairo, on board vessels to be provided by the plaintiffs, 150,000 tons of lump and nut coal of the company's mines in the said county, during each of the years 1870, 1871, and 1872, in equal daily proportions, as near as might be, between the 15th of February and the 15th of December in each of said years. The company also leased certain boats to the plaintiffs. The Grand Tower Company had control of all the coal at Grand Tower; and there was no market there for the purchase of coal but that of the company. It was provided by the agreement that Phillips & St. John should have the sale of all coal produced by the said mines which should be sold at and below Cairo, and that they should not sell any coal north of Cairo. The price to be pai for the coal for the first year was $3 per ton for lump, and $1.50 for nut. The price for the other years was to be graduated by the proportionate expense of mining. Phillips & St. John agreed, if not prevented by ice or low water, to furnish barges or suitable vessels sufficient to receive the said coal in equal daily proportions, which barges and vessels the company agreed to load without unnecessary delay. It was provided by the ninth article of the agreement as follows, that is to say:

'It is further mutually agreed, that if for any other than the unavoidable causes hereinbefore mentioned, and through no fault of the said Phillips & St. John, the parties of the second part, the said Grand Tower Company, party of the first part, shall fail in any one month to deliver all or any part of the quota of coal to which the parties of the second part may be entitled in such month, the party of the first part shall pay to the parties of the second part, as liquidated damages, twenty-five cents for each and every ton which it may have so failed to deliver; or instead thereof, the parties of the second part may elect to receive all or any part of the coal so in default in the next succeeding month, in which case the quota which the party of the first part would otherwise have been bound to deliver under this contract, shall be increased in such succeeding month to the extent of the quantity in default.'

It was on the part of this article above italicized that the controversy between the parties principally turned.

The declaration alleged that the company, without any of the grounds of excuse stated in the agreement, failed to deliver the monthly quota of coal due in October, 1870, although the plaintiffs had barges ready to receive it; and that the plaintiffs thereupon elected to take said quota for said month, amounting to 15,000 tons, in the next succeeding month, and gave notice to the defendant accordingly; but that the defendant also, without any excuse, failed to deliver the said quota in November, 1870, or the quota due for the said month of November, or any part thereof, amounting in all to 30,000 tons which they thus failed to deliver, and that the defendant had never delivered the same. Damages were assigned for loss of profits (the price of coal below Cairo that autumn being, as alleged, $9 per ton), and for the expense of keeping their barges and towboats ready to receive coal at Grand Tower.

Other counts were afterwards added, alleging a like election by the plaintiffs to take the quota for November during the following month of December, and the quotas for both October and November during the said month of December, and a failure to furnish the said quotas, amounting in all to 30,000 tons, with breaches as before.

Various pleas having been put in, the issues were whether the plaintiffs had failed to furnish barges to receive the quotas of coal due in October and November, and if so what damages the plaintiffs sustained by the failure of the defendant to furnish the coal; the question of damages being really the principal question in the cause, no failure to furnish the barges having been shown, but the contrary.

The defendant insisted that by the agreement the damages were liquidated at twenty-five cents per ton for all the coal which it failed to deliver in accordance with the agreement.

The plaintiffs, on the contrary, contended that they had the option either to take the liquidated damages accruing on each month's deficiency, or to insist on having the coal itself delivered to them in the following month; and that when such election was made the refusal by the defendant to deliver the coal entitled the plaintiffs to the actual damage which they sustained by its non-delivery.

The defendant conceded that the plaintiffs had the option referred to, but insisted that the plaintiffs, by electing to receive the deficient coal in the following months, merely postponed the time of its delivery, and increased the quota of the said following month, which thereupon becam subject, if not furnished, to the same rule of liquidated damages as before. If twenty-five cents per ton was all that the defendant was liable for, the damages would have amounted to only $7500, for the quotas of October and November. If the exercise by the plaintiffs of their option to have the coal itself entitled them to the actual damage which they sustained by its non delivery, it is evident, on comparing the price which they were to give for the coal ($3) with that ($9) which coal brought during the autumn of 1870, that their damages might be much more than the sum mentioned.

The court took the plaintiffs' view of the subject, and decided that the plaintiffs were entitled to the actual damages sustained by them by the non-delivery of the quotas of coal for Cotober and November.

The next inquiry, therefore, was as to the rule by which those damages were to be ascertained. On this point the plaintiffs offered evidence to show the prices of coal during November and December, 1870, at all points on the Mississippi River, below Cairo even to New Orleans.

The defendants objected to this, insisting that the price at Grand Tower was the measure of damages if the twenty-five cents per ton were departed from.

The plaintiffs argued that this was a measure impossible to be applied, the Grant Tower Company having a monopoly of the market at Grand Tower, and there being no mines there but the company's own, the company thus making the only market there then was, and refusing to sell.

The court received the evidence offered.

The plaintiffs also offered and were allowed to introduce and read in evidence to the jury several letters from the President of the Grand Tower Company, Mr. G. T. Oliphant, to the company's local agent, one Driggs, at Grand Tower, the existence of which in his hands his testimony disclosed. The following letters give an idea of the class:

[OLIPHANT TO DRIGGS.]

'NEWPORT, September 10th, 1870.

'MY DEAR SIR: I feel more than ever anxious to put an end to the contract with Phillips & St. John. One difficulty in the way is that they possession of our river fleet. This, however, I suppose we could reach by a writ of replevin at any time when the vessels are within our grasp.

'The other obstacle is in the fact that they will undoubtedly sue us for damages, if we decline to deliver them the coal. This makes it important that we should, if possible, place them in the wrong before we take the decisive step. But we cannot afford to wait long, as they could hardly recover enough, in any event, to hurt us as much as we could be hurt by the waste of our river fleet and the embarrassment to our business which their action necessarily involves.

'If they beat us, what damage could they show? The measure of damages would be only the difference between the contract price of our coal and what they might have to pay for other coal of equal quality.

'I have written to Col. Allen on these points, and I wish you would consult him fully and carefully. If I am right, I would take prompt measures to get hold of our river property in their possession; then notify them of our purpose not to deliver any more coal to them. Having this in view, I would hold on to any barges loaded for them this month without coming to an actual rupture, and I would press the settlement of our joint account with them, allowing them, under protest, of course, in order to effect such settlement, more than you believe them entitled to. In other words, get all the money you can first, then get the river stock, and when that is accomplished, throw them overboard, and let them sue.

'Yours, truly,

'G. T. OLIPHANT.

'H. R. DRIGGS.'

[SAME TO SAME.]

'NEWPORT, September 1st, 1870.

'MY DEAR SIR: We must put up the price of coal to transient customers at Grant Tower to $4 1/2 per ton for lump and $2.80 for nut.

'Hurry up a settlement of some sort with Phillips & St. John, and deliver them no more coal without my orders. I want to get all I can out of them before the rupture

'Yours,

'G. T. OLIPHANT.

'H. R. DRIGGS.' [SAME TO SAME.]

'NEWPORT, September 30th, 1870.

'MY DEAR SIR: I have yours of the 9th instant. I note what you say about the advance of prices on the river, which I suggested. I hope to be at Grand Tower this month. Phillips & St. John's account you may leave, though I see little to be gained by delay. Contract or no contract, they will get no more coal from us. The court may award damages, but Phillips & St. John will have to encounter a large expense of time and trouble before they get them, and we had better any the full amount every month rather than go on as present.

'Yours, truly,

'G. T. OLIPHANT.

'H. R. DRIGGS.'

The counsel for the company objected to the introduction of these letters, because they contained nothing addressed to Phillips & St. John, and did not tend to prove or disprove the issue on trial, and were irrelevant and improper. But the court admitted them.

The evidence being closed, the court charged the jury that the true measure of damages was the cash value during those months of the kind of coal mentioned at Cairo, or points below it on the Mississippi River, after deducting the contract price of the coal and the cost and expenses of transporting it thither.

To this charge the defendant excepted.

The jury found damages to the amount of $200,000 (nearly $7 per ton for the alleged deficit of 30,000 tons), and judgment having been given accordingly the defendant brought the case here.

Messrs. T. G. Allen and W. M. Evarts, for the company, plaintiff in error; Mr. H. S. Green, contra.

Mr. Justice BRADLEY delivered the opinion of the court.

title: Grand Tower Company v. Phillips


text: Talk:Grand Tower Company v. Phillips

title: Talk:Grand Tower Company v. Phillips


text:
Grand Tower Company v. Phillips/Opinion of the Court

The court below was of the opinion that the plaintiffs were entitled to the actual damages sustained by them, by the non-delivery of the quotas of coal for October and November, 1870.

The question whether this view was right or not depends upon the true construction of the agreement made by the parties, and we are of opinion that the view taken by the court below on this point was correct. It is evident, from an inspection of the contract, that the election given to the plaintiffs to receive in the following month the coal which they were entitled to receive and did not receive in a particular month, was a substitute for the liquidated damages of twenty-five cents per ton. With regard to that particular amount of coal the rule of liquidated damages was at an end. The agreement did not carry it forward to the following month. It imposed upon the defendant the obligation, if the plaintiffs so elected, to furnish the coal itself instead of paying the liquidated sum. If not so, what was the option worth? It amounted to nothing more than the right of giving to the defendant another month to furnish the coal. Surely they would have had that right without stipulating for it in this solemn way. Had not this option been given to the plaintiffs the defendant would have had the option either to furnish the coal or to pay the twenty-five cents per ton for not furnishing it-a sum which they could very well afford to pay upon a slight rise in the market prices. It was evidently the very purpose of the option given to the plaintiffs to avoid this oppressive result. They could require the coal to be furnished at all events, and, if they elected to do this, it was the duty of the defendant to furnish it. The contrary construction would make the stipulation worse than useless. The plaintiffs might continue to exercise ther election to receive the coal, month after month, without avail, and, at the end, find themselves exactly at the point they started from-forced to accept the twenty-five cents per ton.

The law affords many analogies in accordance with the views we have taken. Thus, by the common law, a gift of property to several in common, and when either of them dies a gift of his share to the survivors, does not subject that share to further survivorship unless it is so expressly provided. So, a condition not to underle without license does not extend to a sub-tenant. Instances of this kind might be multiplied at will.

But whilst we concur with the court below on this point, which is the most important point in the cause, there are certain assignments of error which seem to be well taken and will require a reversal of the judgment. These relate to the admission of evidence which may have affected, and probably did seriously affect, the amount of the verdict.

In regard to the measure of damages, the plaintiffs were allowed to show the prices of coal during November and December, 1870, at all points on the Mississippi below Cairo even to New Orleans. And the court charged the jury against the exceptions of the defendant, that the true measure of damages was the cash value during those months of the kind of coal mentioned in the contract, at Cairo, or points below it on the Mississippi River, after deducting the contract price of the coal and the cost and expense of transporting it thither, and making due allowance for the risk and hazard of such transportation. Now although it is probable that the plaintiffs could have got the prices which the evidence showed were obtained for coal at and below Cairo, had their coal been furnished according to the agreement, yet the rule of law does not allow so wide a range of inquiry, but regards the price at the place of delivery as the normal standard by which to estimate the damage for non-delivery. It is alleged by the plaintiffs that this rule would have been a futile one in their case, because no market for the purchase of coal existed at Grand Tower, except that of the defendant itself, which, by the very hypothesis of the action, refused to deliver coal to the plaintiffs, and which had the whole subject in its own control. This is certainly a very forcible answer to the proposition to make the price of coal at Grand Tower the only criterion. It is apparent that the plaintiffs would be obliged to resort to some other source of supply in order to obtain the coal which the defendant ought to have furnished them. And it would not be fair, under the circumstances of the case, to confine them to the prices at which the defendant chose to sell the coal to other persons. The true rule would seem to be, to allow the plaintiffs to show the price they would have had to pay for coal in the quantities which they were entitled to receive it under the contract, at the nearest available market where it could have been obtained. The difference between such price and the price stipulated for by their contract, with the addition of the increased expense of transportation and hauling (if any), would be the true measure of damages. To this is properly to be added the claim (if any) for keeping boats and barges ready at Grand Tower for the receipt of coal.

But the prices of coal at New Orleans, at Natchez, and other places of distribution and sale, although they might afford a basis for estimating the profits which the plaintiffs might have made had the coal stipulated for been delivered to them, cannot be adopted as a guide to the actual damage sustained so long as any more direct method is within reach.

Another point in which the court erred in the course of the trial, was in the admission of the letters of Oliphant, the president of the Grand Tower Company, containing his private instructions to and correspondence with the local agent at Grand Tower. This evidence was clearly inadmissible under the issue, and should have been excluded. The particular reasons or motives which the company or its officers may have had in not furnishing coal to the plaintiffs were not in issue.

A VENIRE DE NOVO AWARDED.


text: Talk:Grand Tower Company v. Phillips/Opinion of the Court


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Hepburn v. School Directors

ERROR to the Supreme Court of Pennsylvania. The case was thus:

An act of Congress of February 10th, 1868, relating to the taxation by States of shares in the National banks, thus enacts:

'The leg slature of each State may determine and direct the manner and place of taxing all the shares of National banks located within said State, subject to the restriction that the taxation shall not be at a greater rate than is assessed upon other moneyed capital in the hands of individual citizens of such State.'

An act of Assembly of Pennsylvania, of March 31st, 1870, with a view of giving effect to this act of Congress, further enacts:

'All the shares of National banks, located within this State, shall be taxable for State purposes at the rate of three mills per annum, upon the assessed value thereof, and for county, school, municipal, and local purposes, at the same rate as now is or may hereafter be assessed and imposed upon other moneyed capital in the hands of individual citizens of this State.'

This act gives an appeal to the Auditor-General, who is authorized by the act to correct any errors in the assessment.

Another act of Assembly of Pennsylvania, one of April 4th, 1868, enacts that Cumberland County, in which county the town of Carlisle is situated, enacts additionally: 'All mortgages, judgments, recognizances, and moneys owing upon articles of agreement for the sale of real estate, shall be exempt from taxation except for State purposes,' &c.

In this state of legislation, Federal and State, Hepburn, a citizen of Pennsylvania, residing at the borough of Carlisle, in Cumberland County, in the said State, owned four hundred and sixty shares of stock in the First National Bank of Carlisle, the par value of which was $100 a share.

This stock was assessed for county, school, and borough tax by the bank assessor, appointed under an act of Assembly of Pennsylvania, approved April 12th, 1840 at the value of $150 per share.

On amicalbe suit brought by the school directors to test their right to collect the school tax, the Supreme Court of Pennsylvania adjudged that they had such a right; and, to reverse that judgment, Hepburn brought this writ of error.

Mr. Joseph Casey, for the plaintiff in error:

1. There does not seem to be room for doubt that 'moneyed capital in the hands of individual citizens'-the term used in the act of Congress of 1868 and in the act of Pennsylvania of 1870 means private investments other than in stocks or securities. It refers doubtless to loans upon bond and mortgage; loand upon collaterals whether real or personal, and to other loans made in the various modes in which individuals invest their capital upon interest other than in corporation stocks and public securities.

But by the act of Pennsylvania of April 4th, 1868, this 'other moneyed capital in the hands of individuals' residing in Cumberland County (in which is the borough of Carlisle), where this bank whose shares are taxed is located and where Hepburn resides, was not subject to taxation for school purposes. Does not, then, this National bank stock come directly within the express restriction of the act of Congress of February 10th, 1868? Did not the taxation made in this case unfairly and unjustly discriminate against it?

2. But if we are mistaken in this, we say next that the assessment should have valued the stock at its par value, and not at a value above it.

The tax assessed upon 'other moneyed capital in the hands of individuals' by the State of Pennsylvania is upon the par or nominal value of such capital. If money be at interest on bond or mortgage, at three, four, five, or six per cent. interest per annum, the tax of three mills on the dollar is the same in each case.

Yet the securities would have quite different market values. Caeteris paribus, the first three would be below par, the last at or perhaps above it. So, too, when the rate of interest is full, it is the same, too, whether the security be a first mortgage of the highest class-such as would sell in the market above par-or a second mortgage of inferior grade, which could not be sold but at a lar e discount. There is, in short, no provision in the laws of the State for any assessment of the market value of such securities. They are taken at the value indicated on their face and taxed accordingly.

In valuing these shares at fifty per cent. above par the tax is made fifty per cent. greater than on 'other moneyed capital in the hands of individuals.'

Messrs. J. M. Carlisle and J. D. McPherson, contra.

The CHIEF JUSTICE delivered the opinion of the court.

title: Hepburn v. School Directors


text: Talk:Hepburn v. School Directors

title: Talk:Hepburn v. School Directors


text:
Hepburn v. School Directors/Opinion of the Court

The most important question presented by the assignment of errors is, whether shares of stock in a National bank can be valued for taxation by the State in which the bank is located, at an amount exceeding their par value. In is certain that they cannot be taxed at a greater rate than is assessed upon other moneyed capital in the hands of individual citizens of the State. Such is the express provision of the act of Congress.

It is contended that the term 'moneyed capital,' as here used, signifies money put out at interest, and that as such capital is not taxed upon more than its par or nominal value, the par value of these shares is their maximum taxable value.

We cannot concede that money at interest is the only moneyed capital included in that term as here used by Congress. The words are 'other moneyed capital.' That certainly makes stock in these banks moneyed capital, and would seem to indicate that other investments in stocks and securities might be included in that descriptive term.

But even if it were true that these shares can only be taxed as money at interest is, the result contended for would not necessarily follow. The money invested in a bank is not money put out at interest. The money of the bank is so put out and the share of the shareholder represents his proportion of that money. What the amount of this share is, must, in some form, be ascertained in order to determine its taxable value. If the nominal or par value of the stock necessarily indicated this amount, there might be some propriety in making that the taxable value; but, as all know, such is not the case. The available moneyed capital belonging to a bank may be diminished by losses or increased by accumulated profits. Therefore some plan must be devised to ascertain what amount of money at interest is actually represented by a share of stock. The State of Pennsylvania has provided that this may be done by an official appraisement, taking care to prevent abuses by declaring that such appraisement shall not be higher than the current market value of the stock at the place where the bank is located, and by giving an appeal to the Auditor-General, who is authorized to inquire into the value and correct any errors that may appear. There certainly is no apparent injustice in this. It is not the amount of money invested which is wanted for taxation, but the amount of moneyed capital which the investment represents for the time being.

If the value set upon the share does not exceed this amount it will not be assessed at a greater rate than other money at interest. Other plans may be devised to accomplish the same end, but it is sufficient for the purposes of this case that this plan is not unreasonable. If a shareholder is not satisfied with the original appraisement, all he has to do is to appeal to the Auditor-General, make known to him the actual condition of the affairs of the bank, and have the error if any exists corrected. Hepburn did not see fit to avail himself of this right which he had. He preferred to rest upon his supposed right, under the act of Congress, to limit the power of assessment to the par value. This right, we think, he did not have.

It is next insisted that no municipal or school taxes could be assessed upon the shares of the First National Bank of Carlisle, a National bank located within the borough of Carlisle, because by the laws of Pennsylvania, as is claimed, other moneyed capital in the hands of individual citizens at that place is exempt from such taxation.

In support of this claim it is shown that all mortgages, judgments, recognizances, and moneys owing upon articles of agreement for the sale of real estate are exempt from taxation in that borough except for State purposes. This is a partial exemption only. It was evidently intended to prevent a double burden by the taxation both of property and debts secured upon it. Necessarily there may be other moneyed capital in the locality than such as is exempt. If there is, moneyed capital, as such, is not exempt. Some part of it only is. It could not have been the intention of Congress to exempt bank shares from taxation because some moneyed capital was exempt. Certainly there is no presumption in favor of such an intention. To have effect it must be manifest. The affirmative of the proposition rests upon him who asserts it. In this case it has not been made to appear.

JUDGMENT AFFIRMED.


text: Talk:Hepburn v. School Directors/Opinion of the Court


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Green v. Green

APPEAL from the Supreme Court of the District of Columbia. The case was thus:

Thomas Green, by deed dated January 15th, 1867, conveyed certain real estate in Georgetown, D. C., to James Green, in fee in trust. The trust was in these words:

'For the sole and separate use of Catharine Green (wife of the said Thomas) and for the children of said Thomas Green and Catharine Green, during her life, in absolute right and property, as if she was a feme sole, and free and clear of any right, title, and estate, whether as tenants by the curtesy or otherwise, of her present or any future husband, and from his control and from any liability for his debts, and upon trust and to hold and dispose of and convey the said premises in such manner and to such uses, interest, and purposes as she, the said Catharine Green, may from time to time direct, by any last will and testament, or other testamentary writing, of what form soever, which she, the said Catharine Green, notwithstanding her present or any future coverture, shall and may direct, limit, and appoint; and in the absence of any such direction, limitation, or appointment, or subject thereto, or remainder after her death, to her heirs-at-law of the said Catharine Green. 'On the 21st of November, 1868, James Green, as trustee, and Thomas Green and Catharine Green united in a deed to one Ward, whereby they conveyed to him in fee simple the premises described in the deed first set forth, in trust to secure the payment of a note for $6000, payable six months from date, with interest, and bearing even date with the deed, payable to the order of Lewis Wells. At this time Mr. and Mrs. Thomas Green had two daughters, both under age.

This note having matured, and continuing unpaid, Ward, at the request of Wells, advertised the premises for sale, and was proceeding to a sale thereof under the power contained in the deed to Ward.

Hereupon Mrs. Green, and the two infant daughters by their guardian, filed a bill in the court below-the bill in this case against the trustee, the husband, and Ward, alleging that the deed to Ward was improvidently executed; that Mrs. Green had no power to appoint or limit the fee simple of the premises therein described by deed, but only by a last will and testament, or a testamentary writing; that the deed to Ward was accordingly void; that the powers contained in it were unauthorized by the deed of trust to James Green for their benefit; that the title obtained under the deed to Ward would impair the equitable title of the said Mrs. Green and of her children under the deed for her and their benefit, and asking that the deed to Ward might be set aside, and an injunction issue restraining Ward from selling under the alleged authority of the deed to him.

The trustee and the husband answered, admitting the facts as alleged.

Ward answered denying that the deed was void. His position was that under the rule in Shelley's case, the wife became, by the conveyance in trust to James Green, the owner of the property in fee simple; that the estate granted to her for life, and the remainder to her heirs-at-law, being both equitable estates, united in her as an estate of inheritance, and without reference to the exercise of the power of appointment; that, being the owner of the fee, her deed to Ward carried the full title to him.

The court below decreed a perpetual injunction, and that the defendant Ward, be absolutely enjoined and prohibited from selling, or attempting to sell, the property described in the trust deed, except the life interest of Mrs. Green in one-third thereof, and that the defendants below pay the costs of suit.

From this decree the defendants appealed to this court.

Messrs. L. S. Wells and W. B. Webb, for the plaintiff in error; Mr. W. S. Cox, contra.

Mr. Justice HUNT delivered the opinion of the court.

title: Green v. Green


text: Talk:Green v. Green

title: Talk:Green v. Green


text:
Green v. Green/Opinion of the Court

In Shelley's case, the rule is thus laid down: 'that when the ancestor, by any gift or conveyance, taketh an estate of freehold, and in the same gift or conveyance an estate is limited either mediately or immediately to his heirs in fee or in tail, the heirs are words of limitation of the estate and not words of purchase.'

Mr. Preston uses the following language, which is approved by Chancellor Kent: 'When a person takes an estate of freehold legally or equitably under a deed, will, or other writing, and in the same instrument there is a limitation by way of remainder, either with or without the interposition of another estate, of an interest of the same legal or equitable quality to his heirs, or heirs of his body, as a class of persons to take in succession from generation to generation, the limitation to the heirs entitles the ancestor to the whole estate.'

The trust deed of Thomas Green of January 15th, 1867, creates the following trusts, to which the premises are subjected:

1. To the use of Catharine Green and the children of Thomas Green and herself during the life of Catharine Green. There are two such children. Catharine and her two children are, therefore, joint tenants, or tenants in common of the estate during the life of Catharine. The words, 'as if she were feme sole,' 'free and clear of any right or control of her present or future husband,' do not define the estate, but have the effect simply to exclude any possible claim on the part of her husband or his creditors.

2. To such uses and purposes as the said Catharine may, by testamentary writing, limit and appoint.

3. In the absence of such limitation, or subject thereto, or remainder after her death, to the heirs-at-law of the said Catharine.

It is contended that these trusts create an estate in fee simple in Catharine Green, which, by her deed to Mr. Ward, has become vested in him.

The rule in Shelley's case is applicable to trust estates where both the life estate and the remainder are of the same character. The legal effect of the union of the estates, as declared by that rule, does not occur where the life estate is of an equitable character and the remainder is a legal estate, or vice versa. Both estates must be of the same character. The Court of Chancery does not, however, consider itself tied up to an implicit observance of the rule in respect to limitations which do not immediately vest the legal estate.

A distinction is also given by Mr. Fearne to the effect that a trust or use created by deed will often be held to create an estate in the heirs named which cannot be cut off by the act of the tenant for life, when the same offect would not be given to an estate created by like language in a devise. The reason given, viz., that in the former case there may often occur a valuable consideration in the intention to make provision for the issue of an intended m rriage does not exist when the transaction arises after marriage, but still the rule is to some extent a rule of property.

Mr. Cruise, however, says that the same mode of construction is adopted in case of deeds as in case of devises; and so is the case of Ayer v. Ayer, in Massachusetts.

After commenting on various authorities on this subject, Mr. Fearne adds: 'This brings us to those cases of limitations in trust, in decreeing the execution of which the Court of Chancery so far departs from that which would be the legal operation of the words limiting the trust, if reduced to a common-law conveyance, as to construe the words heirs of the body of the cestui que trust, although preceded by a limitation for life, as words of purchase and not of limitation.' Such was the case of Papillon v. Voice, where A. devised a sum of money to trustees, in trust, to be laid out in lands and to be settled on B. for life, remainder to trustees during the life of B., to support contingent remainders, remainder to the heirs of the body of B., remainder over with power to B. to make a jointure. It was decreed that B. should have but an estate for life in the lands so to be purchase, and Lord Chancellor King declared that the diversity was between the will passing a legal estate and leaving the estate executory, so that the party must come into the Court of Chancery in order to have the benefit of the will, that in the latter case the intention should take place and not the strict rules of law.

The case of Bagshaw v. Spencer is quite instructive in its resemblance in some of its facts, to the present case, and in the principle finally announced by Lord Hardwicke, viz., that there is a distinction between a trust in equity and a mere legal estate, and that in the latter class the words must be taken as they stand according to their legal determination, while a different rule prevailed in regard to trusts.

Trusts are the mere creatures of confidence between party and party, totally distinct in almost every quality from those legal estates which are the subjects of tenure. They are in their nature independent of tenure, and therefore not the object of those laws which are founded in the nature of tenure. They are rights arising solely out of the intent of the party who created them, and therefore such intent could be the only guide in the execution of them.

Ware v. Richardson is a case like the one before us, governed by the laws of Maryland, and strikingly akin to it in its main facts. In that case Mrs. Kennedy, 'in consideration of the natural love and affection which she hath and beareth towards Elizabeth Richardson, and in consideration of five shillings to her paid by Samuel N. Ridgely, did grant, bargain, sell, enfeoff, and convey to the said Samuel, his heirs and assigns,' certain property described, to have and to hold in trust, first, that Mrs. Kennedy should enjoy the same during her own life, and after her decease, upon the further trust, that Elizabeth Richardson, during her natural life, should hold and enjoy the same, the rents, issues, and profits thereof, the same to convert to her own proper use and benefit, as if she were feme sole, without let or interference from her husband or liability for his debts; 'and from and immediately after the death of the said Elizabeth, then to, and for the use and benefit of the legal heirs and representatives of the said Elizabeth, and to and for no other intent and purpose.'

As in the present case, it was there contended that by the rule in Shelley's case Elizabeth Richardson took a fee, and that the estate was liable for her debts. The point was elaborately argued by Mr. W. H. Norris in support of this contention, and Mr. T. S. Alexander in opposition thereto, before the Court of Appeals of Maryland. That court held (Mr. Justice Mason delivering its opinion) that this deed created but an equitable life estate in Mrs. Richardson, and that it executed the legal estate in the heirs; that where the estate limited to the ancestor is an equitable or trust estate, and the estate limited to the heirs is an executed use or a legal estate, the two will not coalesce in the ancestor. The rule in Shelley's case was held not to be applicable, and the estate was adjudged to have passed upon her death to her children, Charles and Robert.

The cases of Doe v. Considine, 14 Daniel v. Whartenby, also bear upon the question before us.

In the last case the question arose under a devise 'to Richard Tibbitt during his natural life, and after his death to his issue by him lawfully begotten of his body, to such issue, their heirs and assigns forever,' with limitations over. It was held that the rule in Shelley's case did not govern, and that Richard took a life estate only. It is not as pointed in its authority as the case of Ware v. Richardson, for the reason: 1, that the question arose upon a will and not upon a deed; 2, that the limitation was not to Richard's heirs simply, but to a class equivalent to the children of Richard.

To adjudge that the deed of January 15th, 1867, transferred and conveyed this property in fee to Mrs. Green, so that by the common law her husband would have had as tenant by curtesy an immediate and continuing right to the enjoyment of the rents and profits during his life, and so that her two children would have in it no estate legal or equitable, would be in manifest violation of the intention of the parties to that deed. A rule of the law of tenure, which would require us so to hold, would work a monstrous perversion of justice. We are satisfied that there is no such rule, and that a compliance with the evident intention of the parties is in accordance with the rules of law.

DECREE AFFIRMED.

title: Green v. Green/Opinion of the Court


text: Talk:Green v. Green/Opinion of the Court