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Sheets v. Selden/Opinion of the Court

This is a case in equity. The appellant filed his bill to enjoin the execution of a judgment in ejectment. The defendants demurred, and the demurrer was sustained.

The court gave leave to amend upon terms which the appellant declined to accept. A decree was thereupon entered that the bill should be dismissed, and for costs. This appeal brings the case here for review.

With the leave to amend we have nothing to do. The terms imposed were within the discretion of the court, and are not open to examination in this proceeding.

The only question before us is, whether the Circuit Court erred in sustaining the demurrer and dismissing the case. The bill is very voluminous. We will consider the points to which our attention has been called, so far as is necessary to the proper determination of the rights of the parties.

The recovery was had in the action of ejectment, upon the ground of forfeiture for the non-payment of the rents reserved in two leases.

Both courts of law and of equity have power to give relief in cases of this kind. Courts of law give it upon motion, which may be made before or after judgment. If after judgment, it must be made before the execution is executed. The rent due, with interest and costs, must be paid. Upon this being done, a final stay of proceedings is ordered.

The first British statute upon the subject was the 4th George II, ch. 28. The practice is now regulated by the 15 and 16 Victoria, ch. 76.

Courts of equity are governed by the same rules in the exercise of this jurisdiction as courts of law. All arrears of rent, interest, and costs must be paid or tendered. If there be no special reason to the contrary, an injunction thereupon goes to restrain further steps to enforce the forfeiture. The grounds upon which a court of equity proceeds are, that the rent is the object of the parties, and the forfeiture only an incident intended to secure its payment; that the measure of damages is fixed and certain, and that when the principal and interest are paid the compensation is complete. In respect to other covenants pertaining to leasehold estates, where the elements of fraud, accident, and mistake are wanting, and the measure of compensation is uncertain, equity will not interfere. It allows the forfeiture to be enforced if such is the remedy provided by the contract. This rule is applied to the covenant to repair, to insure, and not to assign. Lord Eldon limited the relief to cases where the lease required the payment of a specific sum of money. The authorities going beyond this he held to be unsound, and declined to follow them. Speaking of Wadman v. Calcraft, he said the Master of the Rolls in that case held, 'that, though against ejectment for non-payment of rent the court would relieve upon a principle long acknowledged in this court, but utterly without foundation, it would not relieve where the right of the landlord accrued, not by non-payment of rent, but by the non-performance of covenants which might be compensated in damages.' Such is now the settled English rule upon the subject. In Bracebridge v. Buckley, Baron Wood, in a dissenting opinion, made an earnest and able assault upon this doctrine. The question may be regarded as yet unsettled in the jurisprudence of this country.

Lord Redesdale held that where there were unsettled accounts between the landlord and tenant, which could not be properly taken at law, the payment or tender of money on account of the rent might be deferred until the rights of the parties were settled by the decree of the court, but that where the accounts were not of this character, equity would not intervene.

The recovery in ejectment is an important feature in the case before us. In Indiana the action is regulated by statute, and the judgment has the same conclusiveness and effect as common law judgments in other cases. The judgment against the appellant established the validity of the leases, that he was in possession, his obligation to pay the rents reserved, and that the instalments demanded were due and unsatisfied. He is estopped from denying these facts, and from setting up anything in this case to the contrary.

In the case of the Trustees of the Wabash and Erie Canal v. Brett, the trustees had leased so much of the surplus water of the canal as might be necessary for the purposes specified. The right was reserved, upon paying for the mill to be built by the lessee, to resume the use of the water leased whenever it might be necessary for navigation, or whenever its use for hydraulic purposes should be found to interfere with the navigation of the canal. It was averred that the trustees had abandoned that part of the canal, and suffered it to go to decay, so that the water-power was destroyed, and the plaintiff's mill rendered valueless. The court held that there was no implied covenant to keep the canal in repair, that the express provision for compensation in one case excluded the implication of such right in all others, and that the plaintiff was without remedy. This case, like the one under consideration, was decided upon a demurrer by the defendants.

The tendency of modern decisions is not to imply covenants which might and ought to have been expressed, if intended. A covenant is never implied that the lessor will make any repairs. The tenant cannot make repairs at the expense of the landlord, unless by special agreement. If a demised house be burned down by accident, the rent does not cease. The lessee continues liable as if the accident had not occurred. If in such a case the landlord receives insurance-money, the tenant has no equity to have it applied to rebuilding, or to restrain the landlord from suing for the rent until the structure is restored.

The Trustees of the Wabash and Erie Canal v. Brett is an authority strikingly apposite in this case. In the leases set out in the bill, as in the lease in that case, the parties provided but one remedy for a failure of water. That is, an abatement of the rent in proportion to the extent and time of the deficiency. The contract gives none other. Beyond this it is silent upon the subject. This court cannot interpolate what the contract does not contain. We can only apply the law to the facts as we find them. The appellant is entitled to the remedy specified. Expressum facit cessare tacitum. Neither a court of equity nor a court of law can aid him to any greater extent.

His sweeps from the case the claims set up in the bill by the appellant for offset, repairs, recoupment, and damages, leaving to be considered only the claim for a reduction of the rents in the manner stipulated by the parties.

The appellant avers that he abandoned the premises covered by the second lease, that the appellees acquiesced, and that his title thus became vested in them by reverter. This is repelled by the verdict and judgment in the action of ejectment.

He insists that, according to the provision referred to in the leases, he is entitled to a reduction of the rents specifically demanded before the commencement of the action of ejectment. The plaintiffs could not have recovered without proving to the satisfaction of the jury that the exact amount demanded was due. Any failure in this respect would have been fatal to the action. Then was the time for the appellant to assert and prove this claim. He cannot do it now. The judgment is conclusive.

The bill claims reductions of the rents for failure of water from the second of October, 1857, when the title of the defendants accrued, down to the first of May, 1865, when the last instalments, before the filing of the bill, became due, amounting in the aggregate to $2649. The rents, during the same period, amounted to a much larger sum. Conceding the appellant's demand to be correct, he should at least have tendered payment of the difference between these two amounts, and interest, before bringing his bill. In not alleging that he had done so the bill is fatally defective.

A case is not presented upon which a court of equity, according to the settled principles of its jurisprudence, is authorized to interpose. The spirit manifested by the appellant throughout the litigation between the parties, as disclosed by the bill, is not persuasive to such a tribunal to lend him its aid. We think the demurrer was well taken. The decree of the Circuit Court is

title: Sheets v. Selden/Opinion of the Court


text: Talk:Sheets v. Selden/Opinion of the Court

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


text:
Payne v. Hook

ANN PAYNE, a citizen of Virginia, exhibited her bill in the Circuit Court of the United States for Missouri, against Zadoc Hook, public administrator of Calloway County, in that State, and his sureties on his official bond, all citizens of Missouri, to obtain her distributive share in the estate of her brother, Fielding Curtis, who died intestate, in 1861, and whose estate was committed to the charge of the public administrator, by order of the County Court of Calloway County. It appeared that Curtis never married, and that his nearest of kin were entitled to distribution of his estate. The bill, without mentioning of what State they were citizens, and without making them complainants, set forth the names of the distributees, brothers or sisters, like the complainant, of the intestate, or their children. The bill charged gross misconduct on the part of the administrator; that he had made false settlements with the Court of Probate; withheld a true inventory of the property in his hands; used the money of the estate for his private gain; and obtained from the claimant, by fraudulent representations, a receipt in full for her share of the estate, on the payment of a less sum than she was entitled to receive. The object of the bill was to obtain relief against these fraudulent proceedings, and to compel a true account of administration, in order that the real condition of the estate can be ascertained, and the complainant paid what justly belongs to her. It appeared from the bill that Hook had not yet made his final settlement.

The defendant demurred generally, and without assigning any specific grounds for the demurrer. On the argument of the demurrer below, the demurrer was endeavored to be supported,

1. Because, in Massouri, exclusive jurisdiction over all disputes concerning the duties or accounts of administrators, until final settlement, is given to the local county court, which is the Court of Probate; and because, as the administration complained of was still in progress in the County Court of Calloway County, resort was to be had to that court to correct the accounts of the administrator, if fraudulent or erroneous.

2. Because the other distributees were not made parties; and so that the case was without proper parties.

3. Because the sureites of the administrator were joined in the proceeding.

4. Because the bill was multifarious.

The court below sustained the demurrer, and the complainant electing to abide by her pleading, the bill was dismissed, and the case brought here by appeal.

Mr. Napton, in support of the decree below:

1. It is perfectly settled, in Missouri, that a court of chancery, under its laws, cannot grant the relief asked in this case until the jurisdiction of the Probate Court is exhausted, or the final settlement of accounts made. No such settlement was here made.

The question then is, will the Federal court, sitting in Missouri, when called upon to interpret State laws in a case where the jurisdiction is given solely because of the noncitizenship of one of the parties, give a relief which the State courts could not?

The chancery jurisdiction of the Federal courts is, we concede, the same throughout the Union; and conferred by the Judiciary Act and the Constitution. What is equity and what is law does not either, with these courts, depend on the State laws or codes of practice.

But the point is, that upon the very principles of equity law, borrowed from England and adopted here, this case ceases to be one of equitable cognizance (or legal cognizance either), just as well in the Federal courts as in the State courts, because of the peculiar structure of the probate system in Missouri, and because the State laws creating that system, and the adjudged construction of those laws, will be enforced in this tribunal just as they would be in a State tribunal, and not overturned or disregarded.

It this is not so, we have the anomaly of citizens not of Missouri, having rights in Missouri and under Missouri laws, which the citizens of Missouri have not; and we put the former not only on an equality with the latter, but actually on a superiority to them. Such a system would be anything else than harmonious. Mereover, it would overturn the whole system of probate jurisdiction in Missouri, so far as persons outside of that State are concerned; for if the United States courts, when called on to construe the Missouri laws concerning administration, &c., can entertain such a bill as the present, contrary to the received practice in this State, then creditors' bills, legatees' bills, bills for marshalling assets, &c., which are common in other States and in England, although unknown in Missouri, would be equally admissible, and thus our system would be completely overturned.

In Ewing v. City of St. Louis, the point seems adjudicated:

'A non-resident complainant can ask no greater relief in the courts of the United States than he could obtain were he to resort to the State courts. If in the latter courts equity would afford no relief, neither will it in the former.'

The exclusive jurisdiction of the Probate Court of Missouri until a final settlement, is a matter not affecting the chancery jurisdiction as a mere remedy, but in the nature of a right. It is, in effect, a species of limitation law, and so the State tribunals regard it, for there is nothing in the equity law of Missouri different from the equity law of this court.

The point thus made is the principal ground of the demurrer. But,

2. The other distributees having been as much interested as the complainant, would properly have been parties. As matters now stand, the public administrator is liable to be harassed by as many suits as there are distributees.

3. The sureties are not liable until their principal fails to pay. There is then a complete and adequate remedy against them at law, and on their bond. There is no reason to make them parties in a proceeding like this, even supposing the claim against the principal well founded,-a matter denied.

4. The bill is multifarious. It seeks a rescission of a contract, the overhauling of inventories, accounts, &c., correcting of settlements, and for general relief.

Mr. Glover, contra.

Mr. Justice DAVIS delivered the opinion of the court.

title: Payne v. Hook


text: Talk:Payne v. Hook

title: Talk:Payne v. Hook


text:
Page:The Confidence Man.djvu/235

Rh truth, I, for one, did not go away entirely ungratified, for, while my father was watering the horses, I slipped back into the cabin, and stepping a round or two up the ladder, pushed my head through the trap, and peered about. Not much light in the loft; but off, in the further corner, I saw what I took to be the wolf-skins, and on them a bundle of something, like a drift of leaves; and at one end, what seemed a moss-ball; and over it, deer-antlers branched; and close by, a small squirrel sprang out from a maple-bowl of nuts, brushed the moss-ball with his tail, through a hole, and vanished, squeaking. That bit of woodland scene was all I saw. No Colonel Moredock there, unless that moss-ball was his curly head, seen in the back view. I would have gone clear up, but the man below had warned me, that though, from his camping habits, the colonel could sleep through thunder, he was for the same cause amazing quick to waken at the sound of footsteps, however soft, and especially if human." "Excuse me," said the other, softly laying his hand on the narrator's wrist, "but I fear the colonel was of a distrustful nature—little or no confidence. He was a little suspicious-minded, wasn't he?"

"Not a bit. Knew too much. Suspected nobody, but was not ignorant of Indians. Well: though, as you may gather, I never fully saw the man, yet, have I, one way and another, heard about as much of him as any other; in particular, have I heard his history again and again from my father's friend, James Hall, the judge, you know. In every company being called upon to

title: Page:The Confidence Man.djvu/235


text:
Payne v. Hook/Opinion of the Court

The jurisdiction of the Circuit Court for Missouri to hear this cause is denied, because, in that State, exclusive jurisdiction over all disputes concerning the duties or accounts of administrators, until final settlement, is given to the local county court, which is the Court of Probate; and as the administration complained of is still in progress in the County Court of Calloway County, resort must be had to that court to correct the errors and frauds in the accounts of the administrator.

The theory of the position is this: that a Federal court of chancery, sitting in Missouri, will not enforce demands against an administrator or executor, if the court of the State, having general chancery powers, could not enforce similar demands. In other words, as the complainant, were she a citizen of Missouri, could obtain a redress of her grievances only through the local Court of Probate, she has no better or different rights, because she happens to be a citizen of Virginia.

If this position could be maintained, an important part of the jurisdiction conferred on the Federal courts by the Constitution and laws of Congress, would be abrogated. As the citizen of one State has the constitutional right to sue a citizen of another State in the courts of the United States, instead of resorting to a State tribunal, of what value would that right be, if the court in which the suit is instituted could not proceed to judgment, and afford a suitable measure of redress? The right would be worth nothing to the party entitled to its enjoyment, as it could not produce any beneficial results. But this objection to the jurisdiction of the Federal tribunals has been heretofore presented to this court, and overruled.

We have repeatedly held 'that the jurisdiction of the courts of the United States over controversies between citizens of different States, cannot be impaired by the laws of the States, which prescribe the modes of redress in their courts, or which regulate the distribution of their judicial power.' If legal remedies are sometimes modified to suit the changes in the laws of the States, and the practice of their courts, it is not so with equitable. The equity jurisdiction conferred on the Federal courts is the same that the High Court of Chancery in England possesses; is subject to neither limitation or restraint by State legislation, and is uniform throughout the different States of the Union.

The Circuit Court of the United States for the District of Missouri, therefore, had jurisdiction to hear and determine this controversy, notwithstanding the peculiar structure of the Missouri probate system, and was bound to exercise it, if the bill, according to the received principles of equity, states a case for equitable relief. The absence of a complete and adequate remedy at law, is the only test of equity jurisdiction, and the application of this principle to a particular case must depend on the character of the case, as disclosed in the pleadings.

'It is not enough that there is a remedy at law. It must be plain and adequate, or, in other words, as practical and efficient to the ends of justice, and its prompt administration, as the remedy in equity.'

It is very evident that an action at common law, on the bond of the administrator, would not give to the complainant a practical and efficient remedy for the wrongs which, she says, she has suffered. A proceeding at law is not flexible enough to reach the fraudulent conduct of the administrator, which is the ground work of this bill, nor to furnish proper relief against it. It is, however, well settled that a court of chancery, as an incident to its power to enforce trusts, and make those holding a fiduciary relation account, has jurisdiction to compel executors and administrators to account and distribute the assets in their hands. The bill under review has this object, and nothing more. It seeks to compel the defendant, Hook, to account and pay over to Mrs. Payne her rightful share in the estate of her brother; and in case he should not do it, to fix the liability of the sureties on his bond.

But it is said the proper parties for a decree are not before the court, as the bill shows there are other distributees besides the complainant. It is undoubtedly true that all persons materially interested in the subject-matter of the suit should be made parties to it; but this rule, like all general rules, being founded in convenience, will yield, whenever it is necessary that it should yield, in order to accomplish the ends of justice. It will yield, if the court is able to proceed to a decree, and do justice to the parties before it, without injury to absent persons, equally interested in the litigation, but who cannot conveniently be made parties to the suit.

The necessity for the relaxation of the rule is more especially apparent in the courts of the United States, where, oftentimes, the enforcement of the rule would oust them of their jurisdiction, and deprive parties entitled to the interposition of a court of equity of any remedy whatever.

The present case affords an ample illustration of this necessity. The complainant sues as one of the next of kin, and names the other distributees, who have the same common interest, without stating of what particular State they are citizens. It is fair to presume, in the absence of any averments to the contrary, that they are citizens of Missouri. If so, they could not be joined as plaintiffs, for that would take away the jurisdiction of the court; and why make them defendants, when the controversy is not with them, but the administrator and his sureties? It can never be indispensable to make defendants of those against whom nothing is alleged and from whom no relief is asked. A court of equity adapts its decrees to the necessities of each case, and should the present suit terminate in a decree against the defendants, it is easy to do substantial justice to all the parties in interest, and prevent a multiplicity of suits, by allowing the other distributees, either through a reference to a master, or by some other proper proceeding, to come in and share in the benefit of the litigation.

The next objection which we have to consider is, that the sureties of the administrator are not proper parties to this suit. Their liability on the bond in an action at law is not denied, but it is insisted they cannot be sued in equity. If this doctrine were to prevail, a court of chancery, in the exercise of its power to compel an administrator to account for the property of his intestate, would be unable to do complete justice, for if, on settlement of the accounts, a balance should be found due the estate, the parties in interest, in case the administrator should fail to pay, would be turned over to a court of law, to renew the litigation with his sureties. A court of equity does not act in this way. It disposes of a case so as to end litigation, not to foster it; to diminish suits, not to multiply them. Having power to determine the liability of the administrator for his misconduct, it necessarily has an equal power, in order to meet the possible exigency of the administrator's inability to satisfy the decree, to settle the amount which the sureties on the bond, in that event, would have to pay.

Besides, it is for the interest of the sureties that they should be joined in the suit with their principal, as it enables them to see that the accounts are correctly settled, and the administrator's liability fixed on a proper basis. If they were not made parties, considering the nature and extent of their obligation, they would have just cause of complaint.

It is said the bill is multifarious, but we cannot see any ground for such an objection. A bill cannot be said to be multifarious unless it embraces distinct matters, which do not affect all the defendants alike. This case involves but a single matter, and that is the true condition of the estate of Fielding Curtis, which, when ascertained, will determine the rights of the next of kin. In this investigation all the defendants are jointly interested. It is true the bill seeks to open the settlements with the Probate Court as fraudulent, and to cancel the receipt and transfer from the complainant to the administrator, because obtained by false representations; but the determination of these questions is necessary to arrive at the proper value of the estate, and in their determination the sureties are concerned, for the very object of the bond which they gave was to protect the estate against frauds, which the administrator might commit to its prejudice.

The decree of the Circuit Court for the District of Missouri is REVERSED, and this cause is remanded to that court with instructions to proceed IN CONFORMITY WITH THIS OPINION.

title: Payne v. Hook/Opinion of the Court


text: Talk:Payne v. Hook/Opinion of the Court

title: Talk:Payne v. Hook/Opinion of the Court


text:
Pacific Insurance Company v. Soule

ON certificate of division from the Circuit Court for California.

The Constitution of the United States ordains thus:

'Direct taxes shall be apportioned among the several States which may be included within the Union, according to their respective numbers.'

With this provision of the Constitution in existence, Congress, by an internal revenue act of June 30, 1864, amended by act of July 13, 1866, laid a certain tax upon the amounts insured, renewed, or continued by insurance companies; upon the gross amount of premiums received and assessments by them; and a tax also upon dividends, undistributed sums, and income. A portion of the ninth section of the internal revenue act of July 13, 1866, and acts amendatory thereto, provide:

'That it shall be the duty of all persons required to make returns or lists of income, and articles or objects charged with an internal tax, to declare in such returns or lists whether the several rates and amounts therein contained are stated according to their values in legal tender currency, or according to their values in coined money; and in case of neglect or refusal so to declare to the satisfaction of the assistant assessor receiving such returns or lists, such assistant assessor is hereby required to make returns or lists of such persons neglecting or refusing, as in cases of persons neglecting or refusing to make the returns or lists required by the acts aforesaid, and to assess the duty thereon, and to add thereto the amount of penalties imposed by law in cases of such neglect or refusal. And whenever the rates and amounts contained in the returns or lists as aforesaid, shall be stated in coined money, it shall be the duty of each assessor receiving the same, to reduce such rates and amounts to their equivalent in legal tender currency, according to the value of such coined money in said currency, for the time covered by said returns. And the lists required by law to be furnished to collectors by assessors shall in all cases contain the several amounts of taxes or duties assessed, estimated or valued in legal tender currency only.'

Prior acts of Congress had authorized the issue of United States notes, commonly called legal tender notes. The act first authorizing their issue, an act of February 25, 1862, enacted—

'Such notes shall be receivable in payment of all taxes, internal duties, excises, debts, and demands of every kind due to the United States (except duties on imports), and of all claims and demands against the United States, of every kind whatsoever (except for interest on bonds and notes, which shall be paid in coin), and shall also be lawful money and a legal tender in payment of all debts public and private, within the United States (except duties on imports and interest as aforesaid). And such United States notes shall be received the same as coin at their par value, in payment of any loans that may be hereafter sold or negotiated by the Secretary of the Treasury, and may be reissued from time to time, as the exigencies of the public interests shall require.'

With these acts in force, the Pacific Insurance Company, a corporation engaged in the business of insurance in California, made returns upon the amounts insured, renewed, &c., by it, upon its premiums and assessments, and finally upon its dividends, undistributed sums, and income; all as required by the statute; the correctness of all the returns being conceded. The different sources of income thus returned had been received by the company in coined money (the currency of California), and the amounts as returned were the amounts in that form of currency. The aggregate tax under the statute upon this sum of coin was $5376. The assessor then (against the protest of the insurance company) added to the amounts as returned, the difference in value between legal tender currency and coined money during the time covered by the returns; and fixing the tax upon the sum as thus increased, the aggregate amount of the tax came to $7365. The collector demanded payment of this sum. The company refused to pay the $7365, but tendered the $5376 in legal tender notes. The collector refusing this, and having seized and being about to sell the insurance company's property, the company paid the larger sum, $7365, under protest. The suit below was to recover back the amount wrongly paid. The case coming on to be heard upon demurrer, the court was divided in opinion upon seven questions, reducible, as this court considered, in substance to these two:

1. Whether that portion of the ninth section of the internal revenue act of July, 1866, above quoted, 'is to be construed as merely providing a rule as to the currency in which accounts, returns, and lists are to be stated, with a view to uniformity in keeping the accounts of internal revenue, or whether it is to be construed as denying to a person who has received in coined money, incomes or other moneys subject to tax or duty, the right to return the amount thereof in the currency in which it was actually received, and to pay the tax or duty thereon in legal tender currency, and be construed to require that the difference between coined money and legal tender currency shall be added to his return when made in coined money, and that he shall pay the tax or duty upon the amount thus increased?'

2. (Sixth in the series.) Whether the taxes paid by the plaintiff, and sought to be recovered back in this action, are not direct taxes within the meaning of the Constitution?

Mr. Wills, for the Insurance Company:

As to the first question. The undertaking made between the government and the citizen, by Congress, when issuing the notes called legal tenders, was that in all transactions between the government and the citizen, other than in two excepted cases stated, the paper dollar should be equivalent to the coin dollar, and in nothing is this contract made more expressly than in regard to the subject of internal taxation in all its branches. In other words, the government, as the taxing power, agrees that it will receive at par the notes issued by it as a debtor, in payment of all internal taxes due to it as the taxing power. It is therefore estopped from regarding them as below par, for any purpose relating to the subject of internal taxation, including the assessment as well as the payment of that class of taxes.

The portion of the ninth section of the Internal Revenue Act of 1866 in question cannot therefore be held to deny to any man who actually receives his income in coin-a form in which income is universally received in California where this case comes from-the right to pay his tax on such income, in notes of the government, at the value expressed on their face.

As to the second question. The ordinary test of the difference between direct and indirect taxes, is whether the tax falls ultimately on the tax-payer, or whether, through the tax-payer, it falls ultimately on the consumer. If it falls ultimately on the tax-payer, then it is direct in its nature, as in the case of poll taxes and land taxes. If, on the contrary, it falls ultimately on the consumer, then it is an indirect tax.

Such is the test, as laid down by all writers on the subject. Adam Smith, who was the great and universally received authority on political economy, in the day when the Federal Constitution was framed, sets forth a tax on a person's revenue to be a direct tax. Mill, Say, J. R. McCulloch, Lieber, among political economists, do the same in specific language. Mr. Justice Bouvier, in his learned Law Dictionary, defines a capitation tax, 'A poll tax; an imposition which is yearly laid on each person according to his estate and ability.'

title: Pacific Insurance Company v. Soule


text: Talk:Pacific Insurance Company v. Soule

title: Talk:Pacific Insurance Company v. Soule


text:
Pacific Insurance Company v. Soule/Opinion of the Court

[The counsel quoting a learned brief of Mr. W. O. Bartlett, then went into an examination of the opinions of Chief Justices Ellsworth and Marshall, Oliver Wolcott, Madison, and others, to show that in their opinion, a tax like the present one would fall within the nature of a direct tax.]

Indeed, it is obvious that an income tax, levied on the profits of any business, does not fall ultimately on the consumer or patron of that business, in any other sense than that in which a poll tax or land tax may be said ultimately to fall, or be charged over by the payer of those taxes upon the persons with whom and for whom they do business, or to whom they rent their lands. The refinement which would argue otherwise, abolishes the whole distinction, and under it all taxes may be regarded as direct or indirect, at pleasure.

But, if the distinction is recognized (and it must be, for the Constitution makes it), then it follows, that an income tax is, and always heretofore has been, regarded as being a direct tax, as much so as a poll tax or as a land tax. If it be a direct tax, then the Constitution is imperative that it shall be apportioned.

If it be argued that an income tax cannot be apportioned, then, it cannot be levied; for only such direct taxes can be levied as can be apportioned.

But an income tax can be apportioned as easily as any other direct tax; first, by determining the amount to be raised from incomes throughout the United States, and then by ascertaining the proportion to be paid by the people of each State. An income tax, in the matter of its apportionment, is not embarrassed by any other difficulties than those which grow out of apportionment, in the admitted cases of poll taxes and land taxes.

It was clearly the object of the act, to compel parties to pay the legal percentage on their incomes, estimating them at their value in legal tender currency. If the reduction of all incomes to a legal tender standard was intended for no other purpose than to establish a uniform system in keeping the accounts of the internal revenue department, it is difficult to understand, first, why, in case of refusal to declare in which currency the income return is made, the assessor should be entitled to disregard the return, and exact, over and above the regular income tax, a penalty of twenty-five per cent.; and why 'the lists required by law to be furnished to collectors by assessors' are required 'in all cases to contain the several amounts of taxes assessed, estimated or valued in legal tender currency only?' If the collector's lists are to contain these amounts, these are the amounts to be collected and paid. This is evident from other provisions of the internal revenue law. Thus, by section 20 of act of June 30, 1864, as amended by act of July 13, 1866, as soon as the assessment has become perfect, the assessor is to make out the list and send it to the collector, and this list is the guide of the collector in the collection of the tax; and by section 34 of same act, as amended, the collector is charged with the amount of taxes as stated on the face of the lists, and credited with the amount of his collections.

The collector's duty is plain: to collect the amount set forth in the assessment list. The corresponding duty of the party taxed is equally clear, namely, to pay this amount.

The language of the law is in harmony with the obvious intention of those who framed it, which was to adopt one uniform standard for the computation, assessment and payment of taxes of this description.

The other question is one which seems settled by the case of Hylton v. United States, unanimously decided after able argument.

Reply: It is undoubtedly to dicta of the judges in Hylton v. United States, to the effect that a capitation tax and a tax on land are the principal, if not the only, direct taxes within the meaning of the Constitution, that the general acquiescence in the unapportioned income tax is, in a great degree, attributable. The case was as follows: Hylton kept one hundred and twenty-five chariots; they were taxed by the United States, and the Supreme Court held that the tax was indirect, and did not require to be laid according to the rule of apportionment. The decision of the particular case before the court was probably correct. It is impossible that a man could have kept so many carriages for himself and his family only to ride in; and, although he is stated in the report of the case to have kept them for his own use, it is presumed that the use referred to was the conveyance of passengers for hire; in other words, that the one hundred and twenty-five chariots pertained to a line of stage-coaches. If this was the fact, the tax was indirect; for the tax-payer could charge it all over to his passengers by making a slight addition to their fare. But although the decision of the case before the court appears, for the reason stated, to have been correct, positions were taken, in the opinions of the judges delivered on the occasion, which are wholly untenable.

The court, at the time, was without a chief justice. Mr. Ellsworth was sworn in on the day of the decision, and took no part in it; and the case was decided at a very early day, and before the Supreme Court had acquired the high position which it afterwards attained. One of the judges, in delivering his opinion, speaks of it as a 'discourse;' they all evince some want of knowledge of the subject which they discuss. These discourses shine in the light shed back upon them by the great intellect which for so many years illuminated the decisions of this tribunal the illustrious Marshall-with whose grandeur of fame we naturally associate ideas of the Supreme Court.

Mr. Justice SWAYNE delivered the opinion of the court.

The plaintiff brought an action to recover back certain taxes upon its business and income, which it had paid to the defendant upon compulsion and under protest. The defendant demurred to the plaintiff's complaint. Upon the argument of the demurrer, the opinions of the judges of the Circuit Court were opposed upon seven questions, which are set forth in the record. According to the view which we take of the case, it will be sufficient to answer two of them. They cover the entire grounds of the controversy between the parties, and their determination will be conclusive.

They are the first and the sixth. The first is:

'Whether that portion of the ninth (9th) section of the act of Congress, approved July 13, 1866, entitled 'An act to reduce internal taxation,' and to amend an act, entitled 'An act to provide internal revenue to support the government, to pay interest on the public debt, and for other purposes,' approved June 30th, 1864, and acts amendatory thereof, which provides as follows, to wit:

'That it shall be the duty of all persons required to make returns or lists of income, and articles or objects charged with an internal tax, to declare in such returns or lists whether the several rates and amounts therein contained, are stated according to their values in legal tender currency, or according to their values in coined money; and in case of neglect or refusal so to declare, to the satisfaction of the assistant assessor receiving such returns or lists, such assistant assessor is hereby required to make returns or lists for such persons neglecting or refusing, as in cases of persons neglecting or refusing to make the returns or lists required by the acts aforesaid, and to assess the duty thereon, and to add thereto the amount of penalties imposed by law in cases of such neglect or refusal. And whenever the rates and amounts contained in the returns or lists as aforesaid, shall be stated in coined money, it shall be the duty of each assessor, receiving the same, to reduce such rates and amounts to their equivalent in legal tender currency, according to the value of such coined money in said currency, for the time covered by said returns. And the lists required by law to be furnished to collectors, by assessors, shall, in all cases, contain the several amounts of taxes or duties assessed, estimated or valued in legal tender currency only'--

is to be construed as merely providing a rule as to the currency in which accounts, returns, and lists are to be stated, with a view to uniformity in keeping the accounts of internal revenue, or whether it is to be construed as denying to a person who has received, in coined money, incomes or other moneys subject to tax or duty, the right to return the amount thereof in the currency in which it was actually received, and to pay the tax or duty thereon in legal tender currency, and be construed to require that the difference between coined money and legal tender currency shall be added to his return, when made in coined money, and that he shall pay the tax or duty upon the amount thus increased.'

We think there can be no doubt as to the proper solution of this question. A brief analysis of the provisions of the statute which bear upon the subject, will be sufficient to maintain the conclusion at which we have arrived.

1. The person making the return is required to declare whether the amounts set forth in it are stated according to their value in legal tender currency or in coined money.

2. If he fail to do so, he is subjected to a penalty, and the assessor is required to make the returns for him.

3. The list, with all the amounts therein stated, according to their values in legal tender currency, is to be placed by the assessor in the hands of the collector.

4. The collector is charged with the aggregate amount, and credited with his collections and otherwise, as is provided by the statute.

5. The taxes are made a lien, and, in default of payment, property is to be seized and sold by the collector. Both personal and real estate are liable. Full directions are given for the conduct of the proceedings.

The meaning of the statute, examined by its own light, is so clear that argument or illustration is unnecessary. It was the object of Congress to provide a uniform basis of taxation, in order to secure uniformity in the burdens imposed. 'Equality is equity.' According to the theory of the plaintiff, it had a right to have the assessment made upon the amounts received in coin, and to pay in currency, while others, whose receipts were in currency, were to be taxed upon that basis, and to pay in the same medium as the plaintiff. Such a result would be subversive of the plainest principles of reason and justice. It cannot be supposed that such was the intention of those who framed the law. Certainly nothing in its language would warrant the construction contended for.

Where the power of taxation, exercised by Congress, is warranted by the Constitution, as to mode and subject, it is, necessarily, unlimited in its nature. Congress may prescribe the basis, fix the rates, and require payment as it may deem proper. Within the limits of the Constitution it is supreme in its action. No power of supervision or control is lodged in either of the other departments of the government.

To this question it must be answered, that the statute did deny to the plaintiff the right to have the assessment made otherwise than as it was made by the assessor; and that it required the plaintiff to pay the amount of the taxes set forth in the list delivered by the assessor to the collector, and which was paid by the plaintiff, under protest, as appears by the record.

'Whether the taxes paid by the plaintiff, and sought to be recovered back in this action, are not direct taxes, within the meaning of the Constitution of the United States.'

In considering this subject, it is proper to advert to the several provisions of the Constitution relating to taxation by Congress.

'Representatives shall be apportioned among the several States which shall be included in this Union, according to their respective numbers,' &c.

'Congress shall have power to lay and collect taxes, duties, imposts, and excises, to pay the debts and provide for the common defence and general welfare of the United States; but all duties, imposts, and excises shall be uniform throughout the United States.'

'No capitation or other direct tax shall be laid, unless in proportion to the census of enumeration hereinbefore directed to be taken.'

'No tax or duty shall be laid on articles exported from any State.'

These clauses contain the entire grant of the taxing power by the organic law, with the limitations which that instrument imposes.

The national government, though supreme within its own sphere, is one of limited jurisdiction and specific functions. It has no faculties but such as the Constitution has given it, either expressly or incidentally by necessary intendment. Whenever any act done under its authority is challenged, the proper sanction must be found in its charter, or the act is ultra vires and void. This test must be applied in the examination of the question before us. If the tax to which it refers, is a 'direct tax,' it is clear that it has not been laid in conformity to the requirements of the Constitution. It is therefore necessary to ascertain to which of the categories, named in the eighth section of the first article, it belongs.

What are direct taxes, was elaborately argued and considered by this court in Hylton v. United States, decided in the year 1796. One of the members of the court, Justice Wilson, had been a distinguished member of the Convention which framed the Constitution. It was unanimously held, by the four justices who heard the argument, that a tax upon carriages, kept by the owner for his own use, was not a direct tax. Justice Chase said:

'I am inclined to think, but of this I do not give a judicial opinion, that the direct taxes contemplated by the Constitution are only two, to wit: a capitation or poll tax simply, without regard to property, profession, or any other circumstance, and a tax on land.'

Patterson, Justice, followed in the same line of remark. He said:

'I never entertained a doubt that the principal, I will not say the only, object the framers of the Constitution contemplated as falling within the rule of apportionment, was a capitation tax and a tax on land. ..... The Constitution declares that a capitation tax is a direct tax; and both in theory and practice a tax on land is deemed to be a direct tax. In this way the terms 'direct taxes,' and 'capitation and other direct tax,' are satisfied.'

The views expressed in this case are adopted by Chancellor Kent and Justice Story, in their examination of the subject.

Duties are defined by Tomlin to be things due and recoverable by law. The term, in its widest signification, is hardly less comprehensive than 'taxes.' It is applied, in its most restricted meaning, to customs; and in that sense is nearly the synonym of 'imposts.'

Impost is a duty on imported goods and merchandise. In a larger sense, it is any tax or imposition. Cowell says it is distinguished from custom, 'because custom is rather the profit which the prince makes on goods shipped out.' Mr. Madison considered the terms 'duties' and 'imposts' in these clauses as synonymous. Judge Tucker thought 'they were probably intended to comprehend every species of tax or contribution not included under the ordinary terms, 'taxes and excises."

Excise is defined to be an inland imposition, sometimes upon the consumption of the commodity, and sometimes upon the retail sale; sometimes upon the manufacturer, and sometimes upon the vendor.

The taxing power is given in the most comprehensive terms. The only limitations imposed are: That direct taxes, including the capitation tax, shall be apportioned; that duties, imposts, and excises shall be uniform; and that no duties shall be imposed upon articles exported from any State. With these exceptions, the exercise of the power is, in all respects, unfettered.

If a tax upon carriages, kept for his own use by the owner, is not a direct tax, we can see no ground upon which a tax upon the business of an insurance company can be held to belong to that class of revenue charges.

It has been held that Congress may require direct taxes to be laid and collected in the Territories as well as in the States.

The consequences which would follow the apportionment of the tax in question among the States and Territories of the Union, in the manner prescribed by the Constitution, must not be overlooked. They are very obvious. Where such corporations are numerous and rich, it might be light; where none exist, it could not be collected; where they are few and poor, it would fall upon them with such weight as to involve annihilation. It cannot be supposed that the framers of the Constitution intended that any tax should be apportioned, the collection of which on that principle would be attended with such results. The consequences are fatal to the proposition.

To the question under consideration it must be answered, that the tax to which it relates is not a direct tax, but a duty or excise; that it was obligatory on the plaintiff to pay it.

The other questions certified up, are deemed to be sufficiently answered by the answers given to the first and sixth questions.

ANSWERS ACCORDINGLY.


text: Talk:Pacific Insurance Company v. Soule/Opinion of the Court


text:
Ward v. Smith

ERROR to the Circuit Court of Maryland.

In August, 1860, William Ward, a resident of Alexandria in Virginia, purchased of one Smith, of the same place, then administrator of the estate of Aaron Leggett, deceased, certain real property situated in the State of Virginia, and gave him for the consideration-money three joint and several bonds of himself and Francis Ward. These bonds, each of which was for a sum exceeding four thousand dollars, bore date of the 22d of that month, payable, with interest, in six, twelve, and eighteen months after date, 'at the office of discount and deposit of the Farmers' Bank of Virginia, at Alexan dria.'In February, 1861, the first bond was deposited at the bank designated for collection. At the time there was indorsed upon it a credit of over five hundred dollars; and it was admitted that, subsequently, the further sum of twenty-five hundred dollars was received by Smith, and that the amount of certain taxes on the estate purchased, paid by the Wards, was to be deducted.

In May, 1861, Smith left Alexandria, where he then resided, and went to Prince William County, Virginia, and remained within the Confederate military lines during the continuance of the civil war. He took with him the other two bonds, which were never deposited at the Farmers' Bank for collection. Whilst he was thus absent from Alexandria, William Ward deposited with the bank to his credit at different times, between June, 1861, and April, 1862, various sums, in notes of different banks of Virginia, the nominal amount of which exceeded by several thousand dollars the balance due on the first bond. These notes were at a discount at the times they were deposited, varying from eleven to twenty-three per cent. The cashier of the bank indorsed the several sums thus received as credits on the first bond; but he testified that he made the indorsement without the knowledge or request of Smith. It was not until June, 1865, that Smith was informed of the deposits to his credit, and he at once refused to sanction the transaction and accept the deposits, and gave notice to the cashier of the bank and to the Wards, obligees in the bond, of his refusal. The cashier thereupon erased the indorsements made by him on the bond.

Smith now brought the present action upon the three bonds to recover their entire amount, less the sum credited on the first bond when it was deposited, the sum of twenty-five hundred dollars, subsequently received by the plaintiff, and the amount of the taxes paid by the defendants on the estate purchased.

The court below instructed the jury, that if they found that the defendants executed the bonds, the plaintiff was entitled to recover their amounts, less the credit indorsed on the first one, and the taxes paid by defendants, and the subsequent payment to the plaintiff with interest on the same. The plaintiff recovered, and the defendants brought the case to this court by writ of error.

Messrs. Brown and F. W. Brune, for the plaintiffs in error:

1. When securities are left with a bank for collection, the bank is, ipso facto, made the agent of the payee, to receive payment thereof. It is the agent of the payee, not of the payer.

2. The bank may release the payer by receiving payment in gold, silver, copper, drafts, or checks on other banks or private bankers, bank notes of its own or other banks, circulating at par or below par.

It matters not what may be the particular kind or forms of money accepted by the bank, its relation of agent towards its principal and the debtor ceases the moment the funds so received are mingled with its own funds, and credit is given on its books for the amount so collected as cash.

The relationship of debtor and creditor, from that moment, subsists between the bank and its former principal, and the bank is liable for the full amount so credited.

3. It was stipulated in the bonds that they should be payable at the Farmers' Bank; and it was thus made part of the contract that all the bonds should be deposited in that bank by the payee, Smith, at maturity, or before; so that the obligors might be able to make payment of them at the bank, according to the law and usage of banks, in making collections and receiving payments.

It is not pretended that the payee, Smith, gave any instructions to the bank, or made any communication to the obligors, attempting to modify or qualify the general law and practice of banks in reference to such matters.

4. The defendants were entitled to have credited to them the notes they deposited at the bank for the plaintiff, either at their par or actual value; and the court erred in allowing them only the three previous credits mentioned in its instruction; and in allowing plaintiff interest on the entire balance during the war.

Messrs. R. J. and J. L. Brent, contra.

Mr. Justice FIELD, after stating the case, delivered the opinion of the court, as follows:

title: Ward v. Smith


text: Talk:Ward v. Smith

title: Talk:Ward v. Smith


text:
Ward v. Smith/Opinion of the Court

The defendants claim that they are entitled to have the amounts they deposited, at the Farmers' Bank in Alexandria, credited to them on the bonds in suit, and allowed as a set-off to the demand of the plaintiff. They make this claim upon these grounds: that by the provision in the bonds, making them payable at the Farmers' Bank, the parties contracted that the bonds should be deposited there for collection either before or at maturity; that the bank was thereby constituted, whether the instruments were or were not deposited with it, the agent of the plaintiff for their collection; and that as such agent it could receive in payment, equally with gold and silver, the notes of any banks, whether circulating at par or below par, and discharge the obligors.

We do not state these grounds in the precise language of counsel, but we state them substantially.

It is undoubtedly true that the designation of the place of payment in the bonds imported a stipulation that their holder should have them at the bank, when due, to receive payment, and that the obligors would produce there the funds to pay them. It was inserted for the mutual convenience of the parties. And it is the general usage in such cases for the holder of the instrument to lodge it with the bank for collection, and the party bound for its payment can call there and take it up. If the instrument be not there lodged, and the obligor is there at its maturity with the necessary funds to pay it, he so far satisfies the contract that he cannot be made responsible for any future damages, either as costs of suit or interest, for delay. When the instrument is lodged with the bank for collection, the bank becomes the agent of the payee or obligee to receive payment. The agency extends no further, and without special authority an agent can only receive payment of the debt due his principal in the legal currency of the country, or in bills which pass as money at their par value by the common consent of the community. In the case at bar only one bond was deposited with the Farmers' Bank. That institution, therefore, was only agent of the payee for its collection. It had no authority to receive payment of the other bonds for him or on his account. Whatever it may have received from the obligors to be applied on the other bonds, it received as their agent, not as the agent of the obligee. If the notes have depreciated since in its possession, the loss must be adjusted between the bank and the depositors; it cannot fall upon the holder of the bonds.

But even as agent of the payee of the first bond, the bank was not authorized to receive in its payment depreciated notes of the banks of Virginia. The fact that those notes constituted the principal currency in which the ordinary transactions of business were conducted in Alexandria, cannot alter the law. The notes were not a legal tender for the debt, nor could they have been sold for the amount due in legal currency. The doctrine that bank bills are a good tender, unless objected to at the time, on the ground that they are not money, only applies to current bills, which are redeemed at the counter of the bank on presentation, and pass at par value in business transactions at the place where offered. Notes not thus current at their par value, nor redeemable on presentation, are not a good tender to principal or agent, whether they are objected to at the time or not.

In Ontario Bank v. Lightbody, it was held that the payment of a check in the bill of a bank which had previously suspended was not a satisfaction of the debt, though the suspension was unknown by either of the parties, and the bill was current at the time, the court observing that the bills of banks could only be considered and treated as money so long as they are redeemed by the bank in specie.

That the power of a collecting agent by the general law is limited to receiving for the debt of his principal that which the law declares to be a legal tender, or which is by common consent considered and treated as money, and passes as such at par, is established by all the authorities. The only condition they impose upon the principal, if anything else is received by his agent, is, that he shall inform the debtor that he refuses to sanction the unauthorized transaction within a reasonable period after it is brought to his knowledge.

The objection that the bonds did not draw interest pending the civil war is not tenable. The defendant Ward, who purchased the land, was the principal debtor, and he resided within the lines of the Union forces, and the bonds were there payable. It is not necessary to consider here whether the rule that interest is not recoverable on debts between alien enemies, during war of their respective countries, is applicable to debts between citizens of States in rebellion and citizens of States adhering to the National government in the late civil war. That rule can only apply when the money is to be paid to the belligerent directly. When an agent appointed to receive the money resides within the same jurisdiction with the debtor, the latter cannot justify his refusal to pay the demand, and, of course, the interest which it bears. It does not follow that the agent, if he receive the money, will violate the law by remitting it to his alien principal. 'The rule,' says Mr. Justice Washington, in Conn v. Penn, 'can never apply in cases where the creditor, although a subject of the enemy, remains in the country of the debtor, or has a known agent there authorized to receive the debt, because the payment to such creditor or his agent could in no respect be construed into a violation of the duties imposed by a state of war upon the debtor. The payment in such cases is not made to an enemy, and it is no objection that the agent may possibly remit the money to his principal. If he should do so, the offence is imputable to him, and not to the person paying him the money.' Nor can the rule apply when one of several joint debtors resides within the same country with the creditor, or with the known agent of the creditor. It was so held in Paul v. Christie.

Here the principal debtor resided, and the agent of the creditor for the collection of the first bond was situated within the Federal lines and jurisdiction. No rule respecting intercourse with the enemy could apply as between Marbury, the cashier of the bank at Alexandria, and Ward, the principal debtor residing at the same place.

The principal debtor being within the Union lines could have protected himself against the running of interest on the other two bonds, by attending on their maturity at the bank, where they were made payable, with the funds necessary to pay them. If the creditor within the Confederate lines had not in that event an agent present to receive payment and surrender the bonds, he would have lost the right to claim subsequent interest.

JUDGMENT AFFIRMED.

title: Ward v. Smith/Opinion of the Court


text: Talk:Ward v. Smith/Opinion of the Court

title: Talk:Ward v. Smith/Opinion of the Court


text:
Confiscation Cases

THE question in this case arose upon a motion of Mr. Evarts, Attorney-General, in fifteen appeals from the Eastern District of Louisiana, in which judgments had been given on libels for condemnation and forfeiture-as having been employed in aid of the rebellion, with the consent of the owners-against the Trent and five other vessels, from which judgments the owners of the vessels appealed; and given in favor of the Eleanor and eight other vessels, from which the United States appealed.

Mr. Justice CLIFFORD stated the case more particularly, prior to delivering, as hereinafter, the opinion of the court.

title: Confiscation Cases


text: Talk:Confiscation Cases

title: Talk:Confiscation Cases


text:
Confiscation Cases/Opinion of the Court

Property owned by any person who knowingly uses or employs the same, or who consents to the use or employment of the same in aiding, abetting, or promoting insurrection against the government of the United States, under the conditions specified in the first section of the act of the 6th of August, 1861, is declared by that act 'to be lawful subject of prize and capture,' and all property purchased, acquired, sold, or otherwise transferred, with intent that the same may be so used or employed, is also declared to be subject to the same proceedings, and the provision is, that it shall be the duty of the President to cause the same to be seized, confiscated, and condemned.

Proceedings for the condemnation of such property may be instituted by the Attorney-General, or by any district attorney for the district in which the property is situated at the time the proceedings are commenced, and the third section provides, that in such cases 'the proceedings are wholly for the benefit of the United States;' but the same section also provides, that 'any person may file an information with such attorney, in which case the proceedings shall be for the use of such informer and the United States in equal parts.'

Pursuant to those provisions libels of information were filed in these cases by the district attorney of the United States for the Eastern District of Louisiana, in the Circuit Court of the United States for that district, in which it was alleged that the steamer Eleanor was seized on the 15th of June, 1865, and that the steamer Trent was seized on the 30th of June in the same year.

Apart from the names of the vessels, and the time when the respective seizures were made, the allegations of the libels are similar in every respect material to this investigation. They were addressed to the judges of the Circuit Court for that district, and the introductory allegation in each states that the district attorney prosecutes for the United States, and in the name and behalf of the United States and Charles Black, informant, against the respective steamers, their tackle, apparel, and furniture, and the prayer of the respective libels is for process of monition, order of publication, and for a decree of condemnation to the use and ownership of the United States and of the informant.

Both steamers were seized, and process was served in each case; but the steamers were afterwards released by the order of the court, made at the request of the claimants, who respectively gave bonds for their appraised value. Subsequent proceedings in the two cases were in all respects the same, except that the decree in the first case was for the claimants, and in the second for the United States, and the losing party in each case appealed to this court. Other appeals in like cases were entered in this court at the same term, and they have remained on the calendar to the present time.

Early in the present term some of the cases were heard upon the merits; but these cases now come before the court on certain motions made in behalf of the United States by the Attorney-General. His motion in the first case is for leave to dismiss the libel of information; and in the second case, his proposition is to the effect that the decree of the Circuit Court, which was in favor of the United States, shall be reversed, and the cause remanded, with a view that the same may be dismissed in the court where the suit was instituted. When the motions were made they were taken under advisement; but the court subsequently decided that the motions ought to be granted, unless the informer desired to be heard in opposition to the discontinuance of the prosecutions. Since that time the informer has been heard, and the court has come to the conclusion that the respective motions must be granted.

Provision was made by the thirty-fifth section of the Judiciary Act for the appointment of an attorney of the United States in each district, and the same section makes it his duty to prosecute in such district all delinquents for crimes and offences cognizable under the authority of the United States, and all civil actions in which the United States shall be concerned, except before the Supreme Court, in the district in which that court shall be holden.

In the prosecution of suits in the name and for the benefit of the United States, the seventh section of the act of the 15th of May, 1820, provided that the district attorneys should conform to such directions and instructions as they should receive from the agent of the treasury; but the first section of the act of the 2d of August, 1861, devolves the general superintendence and direction of district attorneys, as to the manner of discharging their respective duties, upon the Attorney-General of the United States.

Public prosecutions, until they come before the court to which they are returnable, are within the exclusive direction of the district attorney, and even after they are entered in court, they are so far under his control that he may enter a nolle prosequi at any time before the jury is empanelled for the trial of the case, except in cases where it is otherwise provided in some act of Congress.

Civil suits, in the name and for the benefit of the United States, are also instituted by the district attorney, and, in the absence of any directions from the Attorney-General, he controls the prosecution of the same in the district and circuit courts, and may, if he sees fit, allow the plaintiffs to become nonsuit, or consent to a discontinuance.

Settled rule is that those courts will not recognize any suit, civil or criminal, as regularly before them, if prosecuted in the name and for the benefit of the United States, unless the same is represented by the district attorney, or some one designated by him to attend to such business, in his absence, as may appertain to the duties of his office.

Under the rules of the common law it must be conceded that the prosecuting party may relinquish his suit at any stage of it, and withdraw from court at his option, and without other liability to his adversary than the payment of taxable costs which have accrued up to the time when he withdraws his suit.

Precisely the same rule prevails in the admiralty courts, and consequently the libellant has the right at any stage of the cause voluntarily to discontinue the same, and the only penalty to which he can legally be subjected, in the absence of any statutory regulation, except, perhaps, in prize cases, is the payment of the costs of the proceedings.

Although the name of the informer in these cases is mentioned in the libel of information, still it is nevertheless true that the suit was instituted by the district attorney in the name and for the benefit of the United States. Control of these suits, therefore, while they were pending in the Circuit Court, belonged to the district attorney under the general superintendence and direction of the Attorney-General, and he might, if he had seen fit, have discontinued them at any stage of the proceedings prior to the appeals. Such control on the part of the district attorney ceases whenever such a suit, civil or criminal, is transferred to this court by writ of error, appeal, or certificate of division of opinion, as the thirty-fifth section of the Judiciary Act also provides, that it shall be the duty of the Attorney-General to prosecute and conduct all suits in the Supreme Court in which the United States shall be concerned, and such has been the unbroken practice of this court in such suits from the organization of the judicial system to the present time. Appointed, as the Attorney-General is, in pursuance of an act of Congress, to prosecute and conduct such suits, argument would seem to be unnecessary to prove his authority to dispose of these cases in the manner proposed in the respective motions under consideration, but if more be needed, it will be found in the case of The Gray Jacket, in which this court decided that in such suits no counsel will be heard for the United States in opposition to the views of the Attorney-General, not even when employed in behalf of another of the executive departments of the government.

Whether tested, therefore, by the requirements of the Judiciary Act, or by the usage of the government, or by the decisions of this court, it is clear that all such suits, so far as the interests of the United States are concerned, are subject to the direction, and within the control of, the Attorney-General.

Objection is made to the granting of the motions, in these cases, upon the ground that it would impair the vested rights of the informer, mentioned in the respective libels of information. Argument for the informer is, that the allegations of the libels afford presumptive evidence that he filed the informations with the district attorney, and that the third section of the act provides that, in that state of the case, the proceedings shall be for the use of such informer, and the United States, in equal parts. Perhaps the better opinion is, that the allegations of the libels, in case of condemnation, would afford prim a facie evidence that the person therein named, as the informer, is entitled to be regarded in that character; but the more important inquiry in this case is, whether he possesses any such interest in the property seized, before final condemnation, as will prevent the Attorney-General from dismissing the suits, as proposed in the motions? Much aid will be derived, in the solution of that question, by a comparison of the third section of the act, invoked as supporting the views of the informer, with similar provisions in other acts of Congress, upon analogous subjects. Regulations were prescribed for the distribution of fines, penalties, and forfeitures, in the first act passed by Congress for the collection of maritime duties, including forfeitures arising from seizures on navigable waters, as well as on land, and the same provisions, in substance and effect, were incorporated into the act of the 2d of March, 1799, which for many purposes, remains in force to the present time.

Those regulations direct that one moiety of the fines, penalties, and forfeitures recovered by those acts, after deducting all proper costs and charges, shall be paid into the treasury, and that the other shall, in certain cases, be divided, in equal proportions, between the collector, naval officer, and surveyor of the port; and, in other cases, that one-half of that moiety shall be given to the informer, and the remainder only to the officers of the customs. Such fines, penalties, and forfeitures were required by those acts to be sued for and recovered in the name of the United States, in any court competent to try and determine the controversy.

Questions of various kinds arose in the construction of those regulations, especially in cases where the claims of informers came in conflict with the assumed rights of subsequent purchasers, and with the action of the Secretary of the Treasury, in remitting such forfeitures under the act of Congress conferring that power upon the head of that department.

Differences of opinion existed among the justices of this court, whether a forfeiture under those provisions, or others of like character, gave such a title to the United States as to overreach a bon a fide sale to an innocent purchaser, when made before seizure and suit for condemnation, but the majority of the court adopted the affirmative of that proposition.

No one, however, contended that any such rule could be applied, in any way, except by relation back to the criminal offence, in cases where the title had been consummated by seizure, suit, and judgment, or decree of condemnation. Next controversy arose between the collector and the heirsat-law of his predecessor, in a case where the seizure had been made by the latter, in his lifetime, and while he was in office, but the decree of condemnation was not entered till after his decease, and the appointment of his successor. Payment of the amount, as ordered in the decree of distribution, was made to the collector in office at the date of the decree, but the court held that the money belonged to his predecessor, in consequence of the inchoate right which he acquired, by virtue of the seizure, and the incipient steps taken by him to cause the suit to be instituted.

Express ruling of the court in that case was, that the right of the collector to forfeitures in rem, attached on the seizure, but that the right must be defined and consummated by the judgment or decree. Authority to remit such fines, penalties, and forfeitures, was conferred upon the Secretary of the Treasury, by the act of the 3d of March, 1797, and the next important controversy which arose upon the subject, was as to the extent of that authority, and whether the secretary could remit the share of the informer, or that of the officers of the customs, subsequent to the judgment or final decree.

Just prior to the decision, in the case of Jones v. Shore's Exrs., Judge Story ruled, in the Circuit Court, that the right of the collector, antecedent to the judgment or decree, was merely inchoate, but he added, what was not necessary to the decision of the case, that his right to the forfeiture vested absolutely with the final sentence of condemnation, and that, after judgment, it could not be remitted by the Secretary of the Treasury.

Unguarded expressions, supposed to support the same conclusion, are also employed in some of the prior, as well as subsequent, decisions of this court.

Doubts arose whether the secretary could remit a forfeiture or penalty, accruing under the several acts, subsequent to the final decree or judgment, but those doubts were soon removed by a unanimous decision of this court, and one which is characterized by accurate analysis, clear statement, and sound conclusions.

Merchandise was imported into the United States in violation of the non-intercourse act then in force, and the vessel and cargo were seized on that account, and were afterwards condemned as forfeited. Subsequent to the decree of condemnation, the Secretary of the Treasury remitted the whole forfeiture, and this court held that he did not exceed his authority; that neither the rights of the informer, nor the rights of the collector, or other officers of the customs, were violated in the case; that their rights were conditional, and subordinate to the power of remission; and that the secretary had authority, under that act, to remit a forfeiture, at any time before or after a final decree or judgment, until the money was actually paid over to the collector for distribution, and that the power to remit extends not only to the interest of the United States, in the forfeiture, but also to the share of the informer, and that of the officers of the customs.

Informations, to recover municipal forfeitures, whether the seizure was made on navigable waters or on land, must be instituted in the name of the United States, and they must be prosecuted, in the subordinate courts, by the district attorney, and in this court, when brought here by appeal, or by writ of error, by the Attorney-General. Where the seizure was made on navigable waters, the case belongs to the instance side of the subordinate court; but where the seizure was made on land, the suit is one at common law, and the claimants are entitled to a trial by jury.

Mention of the name of the informer, in the information, in such cases, is not necessary, as he is not a party to the suit, nor is he entitled to be heard, as such, in any stage of the proceedings. He cannot institute the suit, nor move for process, nor join in the pleadings, nor take testimony, nor except to the ruling of the court, nor sue out a writ of error, or take an appeal. Judgment is for the claimants, or for the United States, and if for the latter, and the claimants do not remove the cause into this court for revision, it then becomes the duty of the court to render the decree for distribution. Prior to such a decree, the interest of the informer is conditional, and under the decisions of this court it continues to be so until the money is paid over, as required by law.

Viewed in any light, it is quite clear that the informer, in these cases, has no vested interest in the subject-matter of these suits, and that both motions ought to be

GRANTED.

The order in the first case is, that it be dismissed, and that order also disposes of Nos. 26, 27, 28, 29, 30, and 33, 34, and 35.

Order in the second case is, that the decree be reversed, as stipulated by the parties, and that the cause be remanded, with directions to dismiss the libel of information; and this order also disposes of Nos. 44, 46, 48, 63, and 64, on the calendar.

[See supra, 166, Dorsheimer v. United States.]

title: Confiscation Cases/Opinion of the Court


text: Talk:Confiscation Cases/Opinion of the Court


text: United States v. Adams (74 U.S. 463)

title: United States v. Adams (74 U.S. 463)


text: Talk:United States v. Adams (74 U.S. 463)


text:
United States v. Adams (74 U.S. 463)/Opinion of the Court

APPEAL from the Court of Claims.

The suit was founded on the petition of Adams, claiming a balance against the government on contracts with General Fremont, commanding the Western Military District, for the construction of a certain number of mortar-boats and steam tug-boats, to be used on the Western rivers in the late civil war. The contracts were alleged to have been made on or about the 24th of August, 1861, for the mortarboats, at a cost of $8250 each; and on or about the 10th of September following, for the steam tug-boats, at the cost of $2500 each. The petitioner was also to build cabins and pilot-houses, and construct steering apparatus, and windlasses on the steam-tugs, for which he was to receive the sum of $1800 in addition for each boat.

After these boats were constructed they were received into the service of the government by the orders of the Secretary of War. This was in the latter part of November, 1861. Previous to this, on the 14th of October, of that year, General Fremont was superseded in his command. And, in consequence of representations of frauds and irregularities committed by General McKinstry, the chief quartermaster of the army of this military district, who had charge of making contracts for supplies and materials necessary for equipping the troops for the expedition contemplated, and who made the contracts, among many others, in question, the Secretary of War, by order of the President, suspended payments upon all contracts within the department until an investigation could be had into the charges thus made.

General McKinstry was afterwards dishonorably dismissed the service for frauds found to have been committed against the government while serving as chief quartermaster of this army. And, after his suspension, on the 25th of October, 1861, the secretary, by a like order, appointed a board of commissioners 'to examine and report, to the Secretary of War, upon all unsettled claims against the military department of the West, that had originated prior to the 14th of October, 1861, the day General Fremont had been superseded.' This board, composed of three gentlemen of the highest intelligence and character (Messrs. David Davis, Joseph Holt, and Hugh Campbell), met, without delay, at the city of St. Louis, the headquarters of the military department in which the irregularities and frauds in its administration, as charged, had been committed, and entered upon their duties; first giving notice to all persons holding claims against the government to present them for examination, with such proofs and explanations as the claimant might think proper to exhibit. Under this notice, the petitioner, on the 10th of December, 1861, presented his claims, which were as follows:

The United States to Theodore Adams, Dr.

For building 38 mortar-boats for the United States, as

per order of Major-General Fremont, herewith

attached, August 24, 1861,........ $313,500

Deduct this amount, paid by Major McKinstry on the

--- day of ---........... $75,

Deduct this amount, paid by Major A. Allen,

quartermaster, 7th to 12th November, 55,

On this account the commissioners allowed the

petitioner........................ $75,959 24 For building 4 hulls for tug-boats for the United States,

as per contract herewith, dated September 10, 1861,

by Major McKinstry, quartermaster, at $2500 each,. $10,000

For building 4 hulls for tug-boats for the United States,..........................................

as per contract herewith, by Major McKinstry,

quartermaster, dated September 21, 1861, at $

each,............................. 10,000

For building 8 cabins for tug-boats for the United

States, as per contract herewith, dated September

20, 1861, by Major McKinstry, quartermaster, for

$1800 each,....................... 14,400

Deduct amount already paid,........ 9,000

Balance,........................... $25,400


text: Talk:United States v. Adams (74 U.S. 463)/Opinion of the Court


text:
Page:The Confidence Man.djvu/236

222 give this history, which none could better do, the judge at last fell into a style so methodic, you would have thought he spoke less to mere auditors than to an invisible amanuensis; seemed talking for the press; very impressive way with him indeed. And I, having an equally impressible memory, think that, upon a pinch, I can render you the judge upon the colonel almost word for word."

"Do so, by all means," said the cosmopolitan, well pleased.

"Shall I give you the judge's philosophy, and all?"

"As to that," rejoined the other gravely, pausing over the pipe-bowl he was filling, "the desirableness, to a man of a certain mind, of having another man's philosophy given, depends considerably upon what school of philosophy that other man belongs to. Of what school or system was the judge, pray?"

"Why, though he knew how to read and write, the judge never had much schooling. But, I should say he belonged, if anything, to the free-school system. Yes, a true patriot, the judge went in strong for free-schools."

"In philosophy? The man of a certain mind, then, while respecting the judge's patriotism, and not blind to the judge's capacity for narrative, such as he may prove to have, might, perhaps, with prudence, waive an opinion of the judge's probable philosophy. But I am no rigorist; proceed, I beg; his philosophy or not, as you please."

"Well, I would mostly skip that part, only, to begin, some reconnoitering of the ground in a philosophical

title: Page:The Confidence Man.djvu/236


text:
United States v. Kirby

THE defendants were indicted for knowingly and wilfully obstructing and retarding the passage of the mail and of a mail carrier, in the District Court for the District of Kentucky. The case was certified to the Circuit Court for that district.

The indictment was founded upon the ninth section of the act of Congress, of March 3, 1825, 'to reduce into one the several acts establishing and regulating the post office department,' which provides 'that, if any person shall knowingly and wilfully obstruct or retard the passage of the mail, or of any driver or carrier, or of any horse or carriage carrying the same, he shall, upon conviction, for every such offence, pay a fine not exceeding one hundred dollars; and if any ferryman shall, by wilful negligence, or refusal to transport the mail across the ferry, delay the same, be shall forfeit and pay, for every ten minutes that the same shall be so delayed, a sum not exceeding ten dollars.'

The indictment contained four counts, and charged the defendants with knowingly and wilfully obstructing the passage of the mail of the United States, in the district of Kentucky, on the first of February, 1867, contrary to the act of Congress; and with knowingly and wilfully obstructing and retarding at the same time in that district, the passage of one Farris, a carrier of the mail, while engaged in the performance of this duty; and with knowingly and wilfully retarding at the same time in that district, the passage of the steamboat General Buell, which was then carrying the mail of the United States from the city of Louisville, in Kentucky, to the city of Cincinnati, in Ohio.

To this indictment the defendants, among other things, pleaded specially to the effect, that at the September Term, 1866, of the Circuit Court of Gallation County, in the State of Kentucky, which was a court of competent jurisdiction, two indictments were found by the grand jury of the county against the said Farris for murder; that by order of the court bench warrants were issued upon these indictments, and placed in the hands of Kirby, one of the defendants, who was then sheriff of the county, commanding him to arrest the said Farris and bring him before the court to answer the indictments; that in obedience to these warrants he arrested Farris, and was accompanied by the other defendants as a posse, who were lawfully summoned to assist him in effecting the arrest; that they entered the steamboat Buell to make the arrest, and only used such force as was necessary to accomplish this end; and that they acted without any intent or purpose to obstruct or retard the mail, or the passage of the steamer. To this plea the district attorney of the United States demurred, and upon the argument of the demurrer two questions arose:

First. Whether the arrest of the mail-carrier upon the bench warrants from the Circuit Court of Kentucky was, under the circumstances, an obstruction of the mail within the meaning of the act of Congress.

Second. Whether the arrest was obstructing or retarding the passage of a carrier of the mail within the meaning of that act.

Upon these questions the judges were opposed in opinion, and the questions were sent to this court upon a certificate of division.

Mr. Ashton, Assistant Attorney-General, for the United States:

There are authorities which perhaps favor the position of the government, that the arrest of the carrier of the mail under the warrant, was an obstruction of the mail and of the carrier thereof, within the intent and meaning of the act of Congress. United States v. Barney, decided by Winchester, J., in Maryland district, in 1810, is in that direction. The Indictment was under an act in the same words as the act of 1825. The detention was by an innkeeper, under a lien for the keeping of the horses employed in carrying the mail; and the court held that the defendant was not justified. The court says:

'The statute is a general prohibitory act. It has introduced no exceptions. The law does not allow any justification of a wilful and voluntary act of obstruction to the passage of the mail,' etc.

So in United States v. Harvey, where the indictment (which was under the act of 1825) was against a constable for arresting the mail-carrier under a warrant in an action of trespass, Taney, C.J., held that the mere serving of the warrant would not render the party liable; yet 'if by serving the warrant he detained the carrier, he would then be liable.'

Contrary, however, to these decisions, is the ruling of Mr. Justice Washington in United States v. Hart. In that case it was held that the act of Congress was not to be construed so as to prevent the arrest of the driver of a carriage in which the mail is carried, when he is driving through a crowded city at an improper rate.

No opposing counsel.

Mr. Justice FIELD, after stating the case, delivered the opinion of the court, as follows:

title: United States v. Kirby


text: Talk:United States v. Kirby

title: Talk:United States v. Kirby


text:
United States v. Kirby/Opinion of the Court

There can be but one answer, in our judgment, to the questions certified to us. The statute of Congress by its terms applies only to persons who 'knowing and wilfully' obstruct or retard the passage of the mail, or of its carrier; that is, to those who know that the acts performed will have that effect, and perform them with the intention that such shall be their operation. When the acts which create the obstruction are in themselves unlawful, the intention to obstruct will be imputed to their author, although the attainment of other ends may have been his primary object. The statute has no reference to acts lawful in themselves, from the execution of which a temporary delay to the mails unavoidably follows. All persons in the public service are exempt, as a matter of public policy, from arrest upon civil process while thus engaged. Process of that kind can, therefore, furnish no justification for the arrest of a carrier of the mail. This is all that is decided by the case of the United States v. Harvey, to which we are referred by the counsel of the government. The rule is different when the process is issued upon a charge of felony. No officer or employee of the United States is placed by his position, or the services he is called to perform, above responsibility to the legal tribunals of the country, and to the ordinary processes for his arrest and detention, when accused of felony, in the forms prescribed by the Constitution and laws. The public inconvenience which may occasionally follow from the temporary delay in the transmission of the mail caused by the arrest of its carriers upon such charges, is far less than that which would arise from extending to them the immunity for which the counsel of the government contends. Indeed, it may be doubted whether it is competent for Congress to exempt the employees of the United States from arrest on criminal process from the State courts, when the crimes charged against them are not merely mala prohibita, but are mala in se. But whether legislation of that character be constitutional or not, no intention to extend such exemption should be attributed to Congress unless clearly manifested by its language. All laws should receive a sensible construction. General terms should be so limited in their application as not to lead to injustice, oppression, or an absurd consequence. It will always, therefore, be presumed that the legislature intended exceptions to its language, which would avoid results of this character. The reason of the law in such cases should prevail over its letter.

The common sense of man approves the judgment mentioned by Puffendorf, that the Bolognian law which enacted, 'that whoever drew blood in the streets should be punished with the utmost severity,' did not extend to the surgeon who opened the vein of a person that fell down in the street in a fit. The same common sense accepts the ruling, cited by Plowden, that the statute of 1st Edward II, which enacts that a prisoner who breaks prison shall be guilty of felony, does not extend to a prisoner who breaks out when the prison is on fire-'for he is not to be hanged because he would not stay to be burnt.' And we think that a like common sense will sanction the ruling we make, that the act of Congress which punishes the obstruction or retarding of the passage of the mail, or of its carrier, does not apply to a case of temporary detention of the mail caused by the arrest of the carrier upon an indictment for murder.

The questions certified to us must be answered IN THE NEGATIVE; and it is

SO ORDERED.

Mr. Justice MILLER, having been absent at the hearing, took no part in this order.


text: Talk:United States v. Kirby/Opinion of the Court


text:
Mulligan v. Corbins

ERROR to the Court of Appeals of Kentucky; the case being this:

Solomon Brindley, a free colored man, was the owner, in 1808, of a small house and lot of trifling value, on Upper Street, in the city of Lexington, and was now dead. It did not appear when he died, or that he ever transferred the title to the property; but, at a very early day, William T. Barry occupied it, and this occupancy was continued after his death, by his legal representatives, until 1843, when it was sold, as Barry's property, on an execution in favor of the old Bank of Kentucky (then mainly owned by and under the control of the State), and purchased for Martha Ann Corbin, and Martha Ann Corbin, her daughter, two of the defendants in error, who occupied and claimed it until November, 1855.

At this date, T. B. Monroe, Jr., an attorney-at-law, was employed by the auditor of public accounts, in conformity with a statute of Kentucky, by a written contract, to sue for and recover the property, as having escheated on the death of Brindley, it being agreed that Monroe was to have for his compensation a moiety of the property recovered. Monroe, in the execution of his employment, prosecuted a suit in the name of one Baxter, the agent appointed to take charge of escheated estates in Fayette County, where the property was situated, and procured a judgment of eviction, and afterwards undertook to sell the property to Mulligan, the plaintiff in error, and to deliver possession to him. The record did not show that Baxter was a party to this sale, or had sanctioned it. At this point of time the legislature stepped in, and on the 4th of April, 1861, passed a statute, enacting,

'That whatever interest in a small house and lot on Upper Street, in the city of Lexington, which was conveyed, in the year 1808, by Thomas Bodley to Solomon Brindley, may rightfully belong to the State by escheat, or otherwise, since the death of the said Brindley, without any known legal heirs, be, and the same is hereby, released to, and vested in, Martha Ann Corbin for her life, and her daughter, Martha Ann, absolutely after her said mother's death. The said property having been bought, in the year 1843, as the property of William T. Barry, claiming and possessed of it, after said Brindley's death, and conveyed, in 1844, to the said mother and daughter, and who have occupied it as theirs ever since said sale and conveyance.'

Mulligan, having filed a petition against the Corbins to recover possession of the property, insisted that this act of 1861 was inhibited by the Constitution of the United States, because it impaired the obligation of the contract which the auditor made with Monroe. The Court of Appeals directed the petition to be dismissed, and Mulligan brought the case by writ of error here.

Mr. Garrett Davis, for the plaintiff in error, made very numerous objections to the title of the Corbins, in addition to that of the unconstitutionality of the act of the 4th April, 1861.

Mr. Moore, contra.

Mr. Justice DAVIS delivered the opinion of the court.

title: Mulligan v. Corbins


text: Talk:Mulligan v. Corbins

title: Talk:Mulligan v. Corbins