text:
Hendrie v. Sayles/Opinion of the Court

Patents or any interest therein may be assigned by an instrument in writing, and the patentee, his assigns or legal representatives, may in like manner grant and convey an exclusive right under the patent; and where the conveyance precedes the granting of the patent, it may be issued to the assignee, the assignment thereof being first entered of record in the Patent Office. 16 Stat. 202, 203; Rev. Stat., sects. 4895, 4896.

Sufficient appears to show that the complainant claims to be the lawful owner of the patented improvement, which consists of a new mode of operating railroad brakes, and that he became such, as he alleges, by virtue of an instrument of assignment, bearing date July 13, 1854, from the assignee of the original inventors.

Prior to the granting of the patent, to wit, on the first day of April, 1852, the inventors conveyed and set over to the assignor of the complainant all the right, title, and interest whatever which they had, or by letters-patent would be entitled to have and possess, in the described invention; and the record shows that the assignment was duly recorded in the Patent Office, as required by law.

Such an assignment may be made before the patent is obtained; and provision is made that the patent may be issued to the assignee, provided the application is made and duly sworn to by the inventor himself, and the assignment is duly recorded. When so granted, the exclusive interest is vested as a legal estate in the assignee, who thus becomes the lawful holder of the invention, and the inventor himself is divested of the legal title. Curtis, Patents (4th ed.), sect. 168; 16 Stat. 202.

By virtue of the assignment the legal title to the invention vested in the assignee of the inventors, and the record also shows that the patent, on the 6th of July, 1852, was duly issued in his name, it appearing that the application for the same was duly sworn to by the inventors, and that the assignment was duly recorded in the Patent Office, as the act of Congress requires.

Even the respondent concedes that the legal title to the invention was vested in the assignee, as the patentee named in the patent, for the period of fourteen years, which is the term for which the patent was granted. From the date of the assignment to the close of the term for which the patent was granted, it is conceded that the legal title to the invention became vested in the assignee of the inventors, by virtue of the instrument of assignment which they executed to the assignee before the patent was issued. Such an instrument, though executed before the patent is granted, transfers the legal title to the assignee. Gayler v. Wilder, 10 How. 477; Rathbone v. Orr, 5 McLean, 131; Rich v. Lippincott, 2 Fish. 1; Herbert v. Adams, 4 Mas. 15; Dixon v. Meyer, 4 Wash. 72.

Assume that the legal title to the invention was in the assignee, and it requires no argument to prove that he could convey the entire interest to a purchaser for a valuable consideration. Well-founded doubt upon that subject cannot arise, and the record shows that the assignee of the inventors, on the 13th of July, 1854, sold, assigned, transferred, and conveyed to the complainant all his right, title, interest, and claim whatsoever which he then had or may have in and to said invention and patent, and any extension thereof that may hereafter be granted, with certain specified exceptions not material to be noticed in this investigation. Before the term of the original patent expired, due application was made for a renewal and extension of the patent; and it is conceded that it was duly extended and renewed by the commissioner for the further term of seven years from and after the expiration of the first term.

Controversy arising between these parties, the complainant instituted the present suit in the Circuit Court against the respondent. When instituted, the bill of complaint contained many matters which are wholly immaterial in the present controversy, and consequently are omitted. Suffice it to say in this connection that the complainant charges that the respondent has infringed his exclusive right under the extended term of the patent, and prays for process and for an account.

Service was made, and the respondent appeared and demurred to the bill of complaint, showing for cause that the complainant has not in and by his amended bill of complaint made any such title in himself to the extended term of the patent therein set forth as entitles him to any relief. Hearing was had, and the court overruled the demurrer and entered a decree in favor of the complainant, the respondent electing to stand upon his demurrer. Prompt appeal was taken by the respondent to this court, and he maintains the same proposition that he did in the court below, to wit, that the bill of complaint shows no legal title to the extended term in the complainant.

When the patentee assigns the patent to a purchaser, the assignee acquires only the exclusive right to make, use, and vend the patented improvement during the term for which the patent was granted, unless the instrument of assignment contains words showing that the parties intended that the instrument should be more comprehensive and include the extended term in case an extension should be granted by the commissioner. During the term for which the patent is granted the assignee of all the right, title, and interest of the patentee in the same may himself sell, assign, and convey the patent for the residue of the term granted, or he may continue to hold the same during that period, and may make, use, and vend the patented improvement, but his title to the invention terminates when the term of the patent expires; nor will his assignee or grantee stand in any better condition, as the maxim Nemo dat qui non habet applies to the assignee of the patentee. Benjamin, Sales (2d ed.), 5; Peer v. Humphrey, 2 Ad. & E. 495.

Assignees of the patent from the patentee can only sell and convey what they acquire by virtue of the instrument of assignment, and inasmuch as the presumption is that the grantor contracts to sell and convey only what is secured by the patent, the proper construction of the instrument limits the right conveyed to the term expressed in the patent, unless the instrument contains words to indicate a different intent. Holders of patents may not be the inventors, nor is it true in every case that the patent is issued to the inventor. On the other hand, the inventor is vested by law with the inchoate right to the exclusive use of the invention to every extent that the Patent Act accords, which he may perfect and make absolute by proceeding in the manner which the law requires.

Bona fide inventors' rights are never derivative, and they, even before the patent is issued, have the exclusive inchoate right not only to the original patent that may issue, but to any reissue, renewal, or extension that may thereafter be granted under the Patent Act. Authorities to support that proposition are numerous and decisive, and it is equally clear that they may sell, assign, or convey the invention, including the inchoate right to obtain the patent, and to surrender and reissue it or to procure a renewal or extension of the monopoly from the commissioner, if the instrument of assignment contains apt words to show that such was the intent of the grantor.

Such an inventor has no exclusive right to make, use, and vend the improvement until he obtains a patent for the invention, and that is created and secured by the patent; nor can the inventor maintain any suit for infringing the same before the patent is issued, but the inventor, says Mr. Chief Justice Taney, is vested by law with an inchoate right to the exclusive use, which he may perfect and make absolute in the manner which the law requires. Gayler v. Wilder, supra.

Enough appears in that case to show that the invention had been made and the specification prepared to obtain a patent before the instrument of assignment was executed, and the question was whether the instrument was sufficient to transfer the inchoate right of the inventor to the assignee, it appearing by the language of the instrument that it was intended to operate upon the perfect legal title which the inventor then had a lawful right to obtain, as well as upon the imperfect and inchoate interest which he also possessed. Speaking to that point, the learned Chief Justice said there would seem to be no sound reason for defeating the intention of the parties by restraining the operation of the assignment to the right to obtain the patent, and compelling them to execute another transfer of the other inchoate right, unless the act of Congress makes it necessary in order to render the transfer complete; and the court held that no such second assignment is required, as the matter to be assigned is the monopoly or the right of property vested in the inventor, so that when the party acquired an inchoate right to it, and the power to make that right perfect and absolute at his pleasure, the whole interest of the inventor, whether the instrument was executed before or after the patent issued, passed to the assignee.

Two other reasons were given by the Chief Justice in support of the construction of the assignment, which the court adopted in that case, both of which are entitled to weight: 1. That no purpose of justice would be subserved by the opposite rule, which would require the execution of a second instrument to accomplish what the parties intended to do by the first. 2. That the construction was the same as had prevailed in such cases under the prior patent acts. Herbert v. adams, supra.

Views of a like character were expressed by Mr. Justice Curtis at a later period, in a case of great importance. Clum v. Brewer, 2 Curt. C. C. 520. Prior to obtaining the patent, the inventor conveyed to the assignee one undivided fourth part of the invention, and all his rights and property therein; and the patent having subsequently been obtained and the term extended, the question was whether the assignee held the same interest in the extended term. Both parties were represented by able counsel, and the court, upon the authority of Gayler v. Wilder (supra), held that the extended term passed by the assignment as well as the original term. Discussion, it seems, had taken place at the bar in respect to the extent of the property of the inventor in his invention before it is secured by a patent. Preliminary to that subject he adverted to the fact that the instrument of assignment only conveyed one quarter part of the inchoate right. But the inventor, remarked the judge, has not only an inchoate right to obtain a patent securing to him the exclusive right to his invention for the term of fourteen years, but also a further inchoate right to have the term extended on the conditions annexed by the law to the right.

Differences of opinion prior to that time existed in some quarters whether the inchoate right to obtain an extension of the term was the proper subject of purchase and sale; but the court in that case answered the inquiry in the affirmative, and supported his conclusions by the following satisfactory reasons: 1. That the inchoate right to obtain an extension of the patent appertains to the invention as well as the inchoate right to obtain the original patent. 2. That each is incomplete, and its completion depends upon the compliance by the inventor with the statutory conditions and the performance by public officers of certain acts prescribed by law. 3. Though there is an additional condition annexed to the right to obtain an extension of the term beyond what is required to obtain a patent, yet that does not change the nature of the right, and it no more prevents it from being the subject of a contract of sale than any other condition which is attached to it; and he held that the inchoate right to obtain the extension passed by the assignment as well as the inchoate right to obtain the original patent.

Instruments of the kind have more than once been construed by this court, and always in the same way, where the instrument was executed under existing laws. Railroad Company v. Trimble, 10 Wall. 367; Nicolson Pavement Co. v. Jenkins, 14 id. 452.

A deed of assignment, says Mr. Justice Swayne, by which a patentee of an invention conveys all the right, title, and interest which he has in the 'said invention,' as secured to him by letters-patent, and also all right, title, and interest which may be secured to him from time to time, the same to be held by the assignee for his own use and that of his legal representatives to the full end of the term for which said letters-patent are or may be granted, carries the entire invention and all alterations and improvements and all patents whatsoever, issued and extensions alike, to the extent of the territory specified in the instrument.

Beyond doubt, the assignment in that case was made subsequent to the issuing of the patent; but the case fully supports the proposition that the operation of such an instrument is not limited to the term specified in the patent, where the instrument contains apt words to show that the parties intended that its operation should be more comprehensive.

Decisive support to that view is also found in the second case. An assignment of an invention secured by letters-patent, says Mr. Justice Davis, is a contract, and, like all other contracts, is to be construed so as to carry out the intention of the parties to it; and he adds, that it is well settled that the title of an inventor to obtain an extension may be the subject of a contract of sale, and when it is, the instrument by which the sale was effected is the proper subject of construction, in order to determine whether it secures to the purchaser any subsequent extension of the patent, or merely the patent for the original term.

Conveyance in that case was made of all the title and interest the patentee had in the reissued patent, to be enjoyed by the grantee and his legal representatives to the full end of the term for which the patent is or may be granted. Taking the whole instrument together, say the court in that case, it is quite clear that it was intended to secure to the grantee and his assigns the right to use the invention in the locality specified as long as the patentee and his legal representatives have the right to use it anywhere else. Manifestly, say the court, something more was intended to be assigned than the interest secured by the patent, and the court decided that it included the renewal as well as the residue of the original term.

Apt words are required, where the conveyance is of an existing patent, to show that the conveyance includes more than the term specified in the patent; but where the conveyance is of the invention, whether before or after the patent is obtained, the rule is otherwise, unless there is something in the instrument to indicate a different intention, the rule being that a conveyance of the described invention carries with it all its incidents, and all the well-considered authorities concur that the inchoate right to obtain a renewal or extension of the patent is as much an incident of the invention as the inchoate right to obtain the original patent; and if so, it follows that both are included in the instrument which conveys the described invention, without limitation or qualification. Emmons v. Sladden, 9 Off. Gaz. 354; Gayler v. Wilder, supra; Clum v. Brewer, supra; Carnan v. Bowles, 2 Bro. C. C. 84.

Viewed in the light of these suggestions, the court is of opinion that the entire interest in the invention passed from the inventors to the assignor of the complainant by the instrument of assignment which they executed to him before the patent was granted, and that the patent was properly issued in the name of their assignee. They, the inventors, do not controvert the exclusive right of the complainant, nor does the respondent deny that the terms of the assignment from the assignee of the inventors to the complainant are amply sufficient to convey to him all that he claims, if his assignor at the time held the title to obtain the extended term; and the court being of opinion that the assignor of the complainant did hold that right, it follows that there is no error in the record.

Decree affirmed.

title: Hendrie v. Sayles/Opinion of the Court


text: Talk:Hendrie v. Sayles/Opinion of the Court

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


text:
Barnet v. National Bank

ERROR to the Circuit Court of the United States for the Southern District of Ohio.

The facts are stated in the opinion of the court.

Submitted on printed arguments by Mr. R. B. Wilson, Mr. Samuel Shellabarger, and Mr. Jeremiah M. Wilson, for the plaintiffs in error, and by Mr. M. B. Hagans for the defendant in error.

MR. JUSTICE SWAYNE delivered the opinion of the court.

title: Barnet v. National Bank


text: Talk:Barnet v. National Bank

title: Talk:Barnet v. National Bank


text:
Barnet v. National Bank/Opinion of the Court

The bank brought this suit upon a bill of exchange, dated Nov. 18, 1873, for $4,000, drawn by David Barnet upon Barnets & Whiteside, in favor of Robert Marshall, and payable ninety days from date, at the Second National Bank of Cincinnati, Ohio. It was accepted by the drawees, indorsed by the payee, and discounted by the Muncie National Bank of Indiana. Before the maturity of the bill the acceptors made an assignment to David Barnet and Isaac E. Craig, the plaintiffs in error. The suit was commenced in the Court of Common Pleas of Preble County, Ohio, against all the parties to the bill. The assignees intervened and made themselves parties. After the pleadings were made up, the case was removed by the bank to the Circuit Court of the United States for that district. There new pleadings were filed on both sides. The assignees set up three defences: 1. That Barnets & Whiteside were borrowers from the bank as early as Jan. 11, 1866; that the indebtedness was continuous and unbroken from April 8, 1866; that it was at no time less than $4,000, and amounted at one time to $36,000; that at the time of the assignment it was $28,000, upon bills of exchange which represented it; that the bank had taken not less than $5,000 in excess of the legal rate of interest; that for evasion the bills were arranged in series, and that each series was terminated from time to time by refusing to renew and the discounting of a new bill, the proceeds of which were applied in payment of the prior terminating one; that the bank had received satisfaction of all the bills but the one in suit, and that there was nothing due from the defendants. 2. That the bill in suit was the last of eight renewals; that illegal interest was taken upon the series to the amount of $1,116, which it was claimed should be applied as a payment upon the bill in question. 3. That fifty-one bills of exchange of $4,000 each, having ninety days to run, were discounted by the bank for the assignors, the first bearing date March 27, 1872, and the last, July 27, 1873 (the date of each one is given); that illegal interest was taken upon these bills to the amount of $6,324; and that the assignees are entitled to recover double this sum from the bank, to wit, $12,648. There is a prayer for judgment accordingly, and for other proper relief.

Marshall, the payee and indorser of the bills, also filed an answer; but as the record discloses no question raised by him, it need not be more particularly adverted to.

The bank demurred to the several defences set up by the assignees. To the first and third the demurrer was sustained, and overruled as to the second. Upon the latter the plaintiff took issue, and the case was tried by a jury. The jury rendered a verdict in favor of the bank for $4,080.31, and judgment was given accordingly. It does not appear that any thing done by the court touching this trial was objected to by the plaintiffs in error. There is no bill of exceptions in the record.

But one point has been insisted upon by the plaintiffs in error in this court, and it is that the Circuit Court erred in sustaining the demurrers to their first and third defences. That is the only subject before us for examination.

All questions arising under the second defence have been disposed of by the verdict and judgment. How the jury reached their conclusion it is not easy to see, but this is not material, as nothing relating to that part of the case is open to inquiry.

The national currency act of Congress of June 3, 1864 (13 Stat. 99, sect. 30), after prescribing the rate in interest to be taken by the banks created under it, declares:--

'And the knowingly taking, receiving, reserving, or charging a rate of interest greater than aforesaid shall be held and adjudged to be a forfeiture of the entire interest which the note, bill, or other evidence of debt carries with it, or which has been agreed to be paid thereon; and in case a greater rate of interest has been paid, the person or persons paying the same, or their legal representatives, may recover back, in any action of debt, twice the amount of interest thus paid, from the association taking or receiving the same: Provided, that such action is commenced within two years from the time the usurious transaction occurred.' Two categories are thus defined, and the consequences denounced:--

1. Where illegal interest has been knowingly stipulated for, but not paid, there only the sum lent without interest can be recovered.

2. Where such illegal interest has been paid, then twice the amount so paid can be recovered in a penal action of debt or suit in the nature of such actipn against the offending bank, brought by the persons paying the same or their legal representatives.

The statutes of Ohio and Indiana upon the subject of usury may be laid out of view. They cannot affect the case.

Where a statute creates a new right or offence, and provides a specific remedy or punishment, they alone apply. Such provisions are exclusive. ''Farmers' & Mechanics' Nat. Bank v. Dearing'', 91 U.S. 29.

The procedure in the case after it reached the Circuit Court, as well as before, was governed by the Ohio Code of Practice. ''Indianapolis, &c. Railroad Co. v. Horst'', 93 U.S. 291.

The ground of demurrer specified as to both the defences in question is, that the assignees had no legal capacity to defend or prosecute by counter-claim in the case. But this does not take from the plaintiff the right to insist that the facts set forth were insufficient to bar the action. Swan, Plead. and Prac. 234; 1 Nash, Plead. and Prac. 161. Under the New York code, from which the Ohio code is largely copied, it has been held that a demurrer to an answer may be sustained upon a ground not adverted to in the argument by the counsel upon either side. ''Xenia Branch of State Bk. of Ohio v. Lee'', 2 Bosw. (N. Y.) 694. The demurrer was a waiver of every objection not specified, except the substantial and fatal insufficiency of the pleading to which it related with respect to the facts alleged.

An issue ought not to be tried where it would be a sheer mistrial and a mere waste of time. The court ought sua sponte to strike it out of disregard it. If a frivolous issue is left in the record, it does not therefore follow that it is to be seriously treated.

In the first defence, the payment of the usurious interest is distinctly averred, and it is sought to apply it by way of offset or payment to the bill of exchange in suit. In our analysis of the statute, we have seen that this could not be done. Nothing more need be said upon the subject.

In the third defence as set forth the like payment is alleged, and there is a claim to recover double the amount paid by way of counter-claim in the pending suit on the bill.

This pleading is also fatally defective for the same reason as the first one. The remedy given by the statute for the wrong is a penal suit. To that the party aggrieved or his legal representative must resort. He can have redress in no other mode or form of procedure. The statute which gives the right prescribes the redress, and both provisions are alike obligatory upon the parties.

While the plaintiff in such case, upon making out the facts, has a clear right to recover, the defendant has a right to insist that the prosecution shall be by a suit brought specially and exclusively for that purpose,-where the sole issue is the guilt or innocence of the accused, without the presence of any extraneous facts which might confuse the case, and mislead the jury to the prejudice of either party.

The point specified in the demurrer we have had no occasion to consider. Both defences, as they appear in the record, are perhaps liable to other objections; but in examining the case we have not gone beyond the points we have discussed, and we decide nothing else.

Judgment affirmed.


text: Talk:Barnet v. National Bank/Opinion of the Court


text:
Railway Company v. Loftin

ERROR to the Supreme Court of the State of Arkansas.

The Cairo and Fulton Railroad Company was incorporated by the General Assembly of the State of Arkansas, Jan. 12, 1853, to construct a railroad from the Mississippi River opposite the mouth of the Ohio, in Missouri, by way of Little Rock, Ark., to the Texas State line. The capital stock was fixed at $1,500,000, with power of increase, divided into shares of $25 each, to be held as personal property. The board of directors named in the act were authorized to open books of subscription to the stock, and the directors for the time being had power to require the payment of the sums subscribed in such manner and on such terms as they deemed proper. Sects. 11 and 13 are as follows:--

'SECT. 11. That the capital stock and dividends of said company shall be for ever exempt from taxation. The road, fixtures, and appurtenances shall be exempt from taxation until after it pays an interest of not less than ten per cent per annum.'

'SECT. 13. This act shall be deemed a public act, and shall be favorably construed for all purposes therein expressed, and declared in all courts and places whatsoever, and shall be in force from and after its passage: Provided, that all the rights, privileges, immunities, and franchises contained in the charter, granted at this session of the legislature of this State to 'The Mississippi Valley Railroad Company,' and not restricting or inconsistent with this act, are hereby extended to, and shall form a part of, this incorporation as fully as if the same was inserted herein.' Acts of 1853-54, p. 176.

Sect. 25 of the act to incorporate the Mississippi Valley Company is as follows:--

'SECT. 25. That the capital stock of said company, with all the immunities and franchises herein specified, and all machines, cars, engines, or carriages belonging to said company, together will all their works and property, and all profits which shall arise from the same, shall be vested in the respective stockholders of the company for ever, in proportion to their respective shares; and the capital stock of said company and the dividends shall be exempted from taxation until a dividend of six per cent is realized upon the capital stock; and the road, with all its fixtures and appurtenances, including workshops, warehouses, and vehicles of transportation, shall be exempted from taxation for the period of twenty-five years from the completion of the road, and no tax shall ever be levied on said road or its fixtures which will reduce the dividends below ten per cent per annum. Said stockholders shall not be bound or liable for any greater amount than the respective shares of stock which they or either of them own.' Acts 1853-54, p. 181.

On the 9th of February, 1853, Congress made a grant of lands to the State of Arkansas to aid in the construction of the Cairo and Fulton road (10 Stat. 155, 156), and on the 16th of January, 1855, the State transferred the grant to the corporation. Sect. 2 of the statute of the State making this transfer is as follows:--

'SECT. 2. That after the expiration of twenty years from the date of the completion of the said Cairo And Fulton railroad from the Missouri line to the Texas boundary line to the point where said road shall cross Red River, near Rulton, said company shall pay into the State treasury an annual tax upon the road, fixtures, lands, tenements, and houses equal to that paid upon other taxable property in this State, for the time being, and for the purposes of taxation the road, fixtures, lands, tenements, and houses shall be considered separate and distinct from the capital stock, whether all the capital stock shall be expended in building said road, fixtures, houses, tenements, or not, and the capital stock shall be exempt from taxation, as provided for in the eleventh section of said Cairo and Fulton railroad charter, approved the 12th of January, 1853.' Acts 1854-55, p. 150.

This act was amended Nov. 26, 1856, and this particular provision repealed, but sect. 9 of the amended act is as follows:

'SECT. 9. That after said Cairo and Fulton railroad shall have been completed, and shall have declared a dividend of ten per cent per annum upon the capital stock of said company, then, and in that event, said Cairo and Fulton Railroad company shall pay into the State treasury two and one-half per cent upon their net proceeds annually.' Acts 1856-57, p. 7.

The road was not completed until Jan. 15, 1874, and no dividend has ever been declared upon the stock of the company. The total quantity of lands included in the grant was about 1,400,000 acres. Only about $300,000 of capital stock was ever paid in, and the road, which cost about $11,000,000, was built with money borrowed upon bonds and otherwise.

On the 8th of April, 1869, the General Assembly passed an act requiring each railroad company in the State, on or before the first day of January in each year, to furnish the auditor of public accounts a full list of all lands acquired by grant, donation, or subscription in aid of the construction of its road, but provided that such lands should not be listed or subject to taxation until conveyed to actual purchasers. Acts of 1868-69, p. 131. The Cairo and Fulton company made its returns in accordance with the requirements of this act. On the 30th of November, 1875, another act was passed, as follows:--

'SECT. 1. That the assessor in the different counties of this State shall, at the time he assesses the personal property in his county, in the year one thousand eigth hundred and seventy-five, assess and place on the tax-book of his county, under the same rule and restrictions as is required in assessing lands in this State, all the lands in his county heretofore donated, granted, or given to any railroad or railroad corporation, when the title to the lands has passed from the United States government, and such lands shall thereafter be assessed and taxed as other lands in this State.

'SECT. 2. That all laws and parts of laws in conflict with this act be and the same are hereby repealed, and this act take effect and be in force from and after its passage.' Acts 1875-76, p. 29.

The Cairo and Fulton company had been consolidated, pursuant to laws of Arkansas and Missouri, with the St. Louis and Iron Mountain Railroad Company, under the name of the St. Louis, Iron Mountain, and Southern Railway Company, the plaintiff in this action. The lands granted to the Cairo and Fulton company passed by the consolidation to the consolidated company.

The unsold lands were assessed for taxation under the law of 1875, and the consolidated company filed its bill in equity in the State court against Loftin, the collector of Jackson County, to restrain the collection, on the ground that the act under which the assessment was made impaired the obligation of the contract of exemption contained in the charter of the Cairo and Fulton company. The Supreme Court of the State, upon appeal, decided otherwise, and affirmed the decree of the court below, dismissing the bill. To reverse this decree of the Supreme Court, the present writ of error has been brought.

Mr. U. M. Rose for the plaintiff in error.

The capital stock represents the property of the company, whatever that may be. Baltimore v. Baltimore & Ohio Railroad Co., 6 Gill (Md.), 294; Rome Railroad Co. v. Mayor, 14 Ga. 275; Augusta v. Georgia Railroad Co., 26 id. 661; New Haven v. City Bank, 31 Conn. 108; Hannibal & St. Joseph Railroad Co. v. Shacklett, 30 Mo. 550; Richmond v. Richmond & Danville Railroad Co., 21 Gratt. (Va.) 604; State Bank v. Brackenridge, 7 Blackf. (Ind.) 395; Osborne v. New York Railroad Co., 40 Conn. 491; State v. Haight, 34 N. J. L. 319; Farrington v. Tennessee, 95 U.S. 679.

The lands being a part of the capital stock, were therefore, under the charter, exempt from taxation.

Mr. A. H. Garland, contra.

MR. CHIEF JUSTICE WAITE, after stating the facts, delivered the opinion of the court.

title: Railway Company v. Loftin


text: Talk:Railway Company v. Loftin

title: Talk:Railway Company v. Loftin


text:
Railway Company v. Loftin/Opinion of the Court

The principal question in this case is whether the eleventh section of the charter of the Cairo and Fulton Railroad Company, which exempts for ever from taxation the capital stock and dividends of the company, carries with it an exemption of the lands in question so long as they remain unsold. We had occasion at the present term, in Railroad Companies v. Gaines (97 U.S. 697), to construe an exemption clause in a railroad charter almost in the exact language of that now under consideration; and while conceding that ordinarily an exemption of the capital stock is equivalent to an exemption of the property into which the capital has been converted, unless a contrary intention is in some way manifested, we held that as the railroad, with its fixtures and appurtenances, was only exempted from taxation for twenty years, and the capital stock was exempted for ever, it was clear that the road and fixtures could not represent the capital for the purposes of taxation. The twenty-fifth section of the Mississippi Valley charter, even if it was incorporated with that of the Cairo and Fulton company, of which there may be doubt, does not materially change the effect of the eleventh section. It vests the capital stock and property of the company in the stockholders in proportion to their respective shares, but that is far from making the stock and the property identical for the purposes of taxation. Indeed, taking the whole section together, it is apparent that there was in the case of that company the same intention to separate the taxation of the stock from that of the property as is found in the Cairo and Fulton charter.

But when the land grant was made, the intention not to include the lands granted in the exemption of the stock is still more manifest; for it is there expressly provided that the 'road, fixtures, lands, tenements, and houses shall be considered separate and distinct from the capital stock,' and while the original exemption of stock was continued, the lands, &c., were to be taxed after twenty years from the date of the completion of the road. It is quite true that this provision of the granting act was afterwards repealed, and a different mode of taxation adopted; but there is nowhere in the repealing act any intention shown of converting the lands into capital stock, and without some express declaration to that effect, no such conversion will be presumed. The lands were used in lieu of capital. They were given in aid of the construction of the road, and to that extent relieved the company from the necessity of raising money through stock subscriptions; but it would be unreasonable to hold that, because they rendered stock to some extent unnecessary, they were on that account stock itself. Exemptions from taxation are never presumed. On the contrary, the presumptions are always the other way; and as in this case the capital stock is alone exempt, the property of the company is not to be included in the exemption, unless it manifestly represents the stock, within the meaning of that term as used by the legislature in the particular act to be construed. As we said in Railroad Companies v. Gaines (supra), whenever property is exempted by reason of the exemption of capital stock, it is because, taking the whole charter together, such appears to have been the intention of the legislature.

On the whole, we are clearly of the opinion that the lands in question are not included in the exemptions of the original charter. None of the other statutes set out in the bill amount to a limitation of the power of future legislatures in respect to the taxation of the property. They are in no sense contracts, and all not, therefore, irrepealable. Tucker v. Ferguson, 22 Wall. 527.

Judgment affirmed.


text: Talk:Railway Company v. Loftin/Opinion of the Court


text:
United States v. Sherman

ERROR to the Supreme Court of the District of Columbia.

The facts are stated in the opinion of the court.

Mr. William A. Maury for the relator.

The Attorney-General, contra.

MR. JUSTICE STRONG delivered the opinion of the court.

title: United States v. Sherman


text: Talk:United States v. Sherman

title: Talk:United States v. Sherman


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

This was an application to the Supreme Court of the District of Columbia for a mandamus to John Sherman, Secretary of the Treasury, commanding him to pay to Alexander McLeod, the relator, the sum of $4,279.94, with interest from the ninth day of November, 1874. The facts of the case, as they are made to appear, are as follows:--

On the eighteenth day of June, 1869, the relator recovered a judgment in the Circuit Court of the United States for the District of South Carolina against T. C. Callicott, a supervising special agent of the Treasury Department, for the sum of $11,700.68, basides $119.30 for costs. On the 5 the of July next following a ''fi. fa.'' was issued upon this judgment. The execution, however, was suspended by a writ of error sent from this court to the Circuit Court, sued out by direction of the Secretary of the Treasury. But the writ was dismissed on the seventeenth day of February, 1871. Nothing further appears to have been done until June 8, 1874, when the relator applied to the Circuit Court for a certificate of probable cause under the act of Congress of March 3, 1863 (12 Stat. 741), and the act of July 28, 1866 (14 id. 329); and the court certified 'that on the trial of said cause (in the Circuit Court) it appeared there was probable cause moving the defendant (Callicott), for the acts done by him whereon the judgment was had and recovered against him,' 'and, further, that the said acts were done under the direction of the Secretary of the Treasury.' The certificate thus obtained was then brought to the Treasury Department, and on the 4th of November next following the first auditor adjusted the account, the certificated that there was due from he United States to the relator the sum of $12,039.50, the amount of the judgment recovered in the Circuit Court, with interest from June 8, 1874, the time when the certificate of probable cause was given. This adjustment was confirmed and certified by the controller, and that sum was received by the relator on the 9th of the same month.

He now contends that it was an insufficient payment, and that there is still due to him from the United States the sum of $4,279.94, with interest from November 9, aforesaid. It will be noticed that in the adjustment of the account by the first auditor, and in the payment made, no interest was allowed for the time which intervened between the rendition of the judgment and the date when the certificate of probable cause was obtained. That interest as the rate allowed in South Carolina amounted to $4,279.94, and the principal question now raised is whether the United States is under obligation to pay that. The mandamus asked for is to compel allowance and payment of that interest.

We have, therefore, to inquire whether the United States is under obligation to pay interest on the judgment obtained in the Circuit Court from the time when the judgment was rendered, until the certificate of probable cause was given. To this question alone we address ourselves. Several objections to the issue of the mandamus asked by the relator-some of them gave-have been interposed by the defendant, but we do not think it necessary to consider them. The twelfth section of the act of Congress of March 3, 1863 (12 Stat. 741), relative to suits against revenue officers, enacted that where a recovery shall be had in any such suit, and the court shall certify that there was probable cause for the act done by the collector or other officer, or that he acted under the directions of the Secretary of the Treasury or other proper officer of the government, no execution shall issue against the collector or other officer, but the amount so recovered shall, upon final judgment, be provided for and paid out of the proper appropriation from the treasury. This section was, by the act of July 28, 1866 (14 id. 328), declared to extend to and embrace all cases arising under the Captured and Abandoned Property Acts of March 12, 1863, and July 2, 1864, whether then pending or thereafter brought, 'provided that such acts done, or proceedings under the two acts last mentioned, shall have been done and had under the authority or by the direction of the executive government of the United States.'

It was under these acts ostensibly that the certificate of probable cause was obtained.

It was obtained not by the agent of the Treasury Department sued, but on motion of the relator, who was the plaintiff in the suit. Conceding, however, as we do, that the Circuit Court was empowered to give the certificate on the request of either party, it is to be considered what was the liability fastened thereby upon the United States.

The act of Congress enacts that when the certificate of probable cause is given, the amount recovered shall, upon final judgment, be paid out of the appropriation from the treasury. When the certificate is given, the claim of the plaintiff in the suit is practically converted into a claim against the the government. But not until then.

Before that time, the government is under no obligation, and the Secretary of the Treasury is not at liberty to pay. When the obligation arises, it is an obligation to pay the amount recovered; that is, the amount for which judgment has been given. The act of Congress says not a word about interest. Judgments, it is true, are by the law of South Carolina, as well as by Federal legislation, declared to bear interest. Such egislation, however, has no application to the government. And the interest is no part of the amount recovered. It accrues only after the recovery has been had. Moreover, whenever interest is allowed either by statute or by common law, except in cases where there has been a contract to pay interest, it is allowed for delay or default of the debtor. But delay or default cannot be attributed to the government. It is presumed to be always ready to pay what it owes. Certainly there was no delay in the present case. The government paid the amount recovered against Callicott, viz. the sum for which the verdict and judgment were given, as soon as its liability accrued. If there has been a loss of interest, it is not due to the government. It is due to the dilatoriness of the relator himself. He might have applied to the Circuit Court for the certificate of probable cause immediately on the rendition of the judgment, as is generally done, though commonly by the defendant. But he waited nearly five years, from June 18, 1869, to June 8, 1874. It would be strange, indeed, if by his own delay he can compel the United States to pay interest on a judgment which it was ready to pay as soon as its liability accrued.

We do not overlook the fact that the plaintiff's execution was suspended by the writ of error directed by the Secretary of the Treasury. But the execution did not suspend his power to obtain the certificate necessary to cast the liability upon the government, and the writ was dismissed in February, 1871. Then there was nothing in the way of a second execution against Callicott. But no step was taken until more than three years had elapsed, when the certificate was obtained. It cannot be admitted that the plaintiff, at his option, may impose upon the United States a liability to pay interest, as long as he pleases, upon a sum of money that, during all the time in which the interest accrues, the government was not bound to pay. Such, we think, is not the requirement of the act of Congress. The 'amount recovered,' spoken of in the acts of 1863 and 1866, is the sum for which judgment was given, and it does not include the interest which the judgment may bear prior to the time when the certificate of probable cause is made.

It follows that there is nothing due to the relator, and, therefore, he is not entitled to a writ of mandamus.

Judgment affirmed.


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