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Aurora City v. West/Opinion of the Court

Subsequent sets of coupons being unpaid, West & Torrence brought suit on them in the Circuit Court of the United States for Indiana.

The declaration in this third suit recited, 'for that whereas' the city, by virtue of power given in its charter, had lawfully, and in due form, 'and for a valuable consideration,' executed and issued the bonds, and that the plaintiffs, 'for a valuable consideration had become the legal holders, and owners, and bearers' of them, and the city had refused to pay, a right of action had accrued. The city demurred, assigning for cause, that the declaration did not allege that the bonds were issued in pursuance of such a vote of the inhabitants of the city as the charter required.

The court overruled the demurrer and gave judgment against the city.

A yet still additional series of coupons falling due, West & Torrence brought the suit which was now here by error. The declaration contained a special count (much as in the preceding cases), and the common counts. Separate demurrers were filed to the respective counts, but were overruled and withdrawn. The general issue, called in the record the first plea, was also pleaded and subsequently withdrawn; the second count being then left without answer.

Seven special pleas, numbered from two to eight, inclusive, were pleaded to the special count.

The 2d alleged that the bonds were issued without any good or valuable consideration.

The 3d, that they were void, because the company was not chartered to construct a railroad to the city.

The 4th, because a majority of the qualified voters of the city had not signified their assent, &c.

The 5th, because the railroad company was not chartered to make a road to the city.

The 6th, because the subscription was made and the bonds issued before the road was located to the city, and before the railroad company had resolved to make such location.

The 7th, because the stock, before its issue to the defendants, became wholly worthless through the mismanagement of the directors.

The 8th, because the proper officers of the city never sold and delivered the bonds as required by law, and the company obtained them without such sale and without authority.

Notice to the plaintiffs was alleged of all these facts.

Of replications not withdrawn, the first, which was to the second plea, set up the judgment, May Term, 1856, of the Court for Dearborn County.

The 2d was to all the pleas except the 1st, and set up the judgment in the Circuit Court of the United States.

The 5th was to the 3d, 4th, 5th, 6th, 7th, and 8th pleas; and also set up the judgment in the Court of Dearborn County, as described in the first replication.

The 6th was to the 4th plea, and set up the same judgment.

The 8th was also to the 4th plea, and set up that the defendants were estopped by the recital in the bonds from denying that a majority of the qualified voters of the city had assented to the subscription.

The 10th was to the 3d, 5th, and 6th pleas, and set up certain proceedings of the city council, therein recited, as an answer to the said several pleas.

The city demurred specially to each of the replications; but the court overruled the demurrer, and the defendants filed a rejoinder to the 2d replication, the rejoinder being the judgment recovered in the Court of Dearborn County, at May Term, 1861, and that the Supreme Court of the State, on appeal, had reversed it for error, and remanded the cause.

The rejoinder, by agreement, was to be regarded as pleaded to all the replications adjudged good except the 10th.

The rejoinder being held bad on demurrer the parties waived a jury, and submitted the cause to the court for the assessment of damages, and the court, having heard the evidence, gave judgment for the plaintiffs. Upon which the defendants took a bill of exceptions.

Mr. Lincoln, for the City, plaintiff in error:

1. The plaintiffs seek to set up the judgments, in the Dearborn County Court, as an estoppel; but the Supreme Court of Indiana, having sustained the defences in this suit, between these parties, the plaintiffs below cannot so use that case. We have an estoppel against an estoppel. This opens the whole matter, and sets it at large.

Independently of this, the replications are so manifestly irregular that, as being the first fault in the pleading, we are entitled to judgment.

2. But without pressing these technical matters, the second plea distinctly avers that the bonds were issued without any consideration, and that this fact was known to the plaintiffs when they received them. Now certainly, neither in the Dearborn County Court case, nor in that in the Federal court in Indiana, was the bona fides of the bonds put in issue, contested, and determined. Both cases went off upon demurrer. The whole history is matter of record; and an examination of the records, and a comparison of them with the record in this suit, will show that this is as we here assert. The demurrer did not cover all the facts involved in this suit. A recital is not an averment or allegation. Now the plea of res judicata is a plea of estoppel, and requires the highest degree of certainty. It cannot be aided by inference. It holds good only in those cases where the identical point in dispute, in the case wherein it is pleaded, was put in issue, contested, and determined upon in the former suit.

It may be stated as a matter of fact, that the want of bona fides in the issue was not known to the city until lately. It neither was nor could have been put in issue.

3. The coupons having been themselves for interest ought not to bear interest; the compounding of interest as against a debtor not being favored.

Mr. Stanbery, who filed a brief for Mr. Mitchell, contra:

1. There is nothing to show that the judgment below was not rendered on the second count. To it there was no plea; and a demurrer had been withdrawn. Certainly judgment might have been rendered by nil dicit.

2. The Supreme Court of Indiana 'remanded' the cause for further proceedings. The case, as an estoppel against an estoppel, thus comes to nothing.

3. The want of bona fides, now rested on, was, if existing in fact, a matter connected with the very origin of these things. It might, and, if meant to be relied on at all, ought to have been pleaded in the earlier suits. A party having divers defences to the same instruments has no right to present but one at a time, take his chance on trial with that one, and, if he fail on that trial, bring up his reserves, singulatim, in this way. If that were allowable, a party might keep his case open forever. The rule may be different in regard to a defence occurring since the last trial, or as to one of which the defendant could not possibly have then had knowledge. Nothing of that sort appears, or can be now asserted here. The case is on pleadings.

But we think that the bona fides of the issue of the bonds was involved in the former suits. The declaration in one of them recites expressly 'the valuable consideration' in the case. Indeed, it was essential under any circumstances to prove that the city did execute and deliver the bonds for a valuable consideration. The plaintiffs could not have got along otherwise. This is sufficient, and the fact of consideration must be therefore taken to be established by the judgments.

4. The interest on the coupons was rightly given; interest being, properly enough given, on a debt due, demanded, and withheld.

Mr. Justice CLIFFORD delivered the opinion of the court.

Fifty bonds, of one thousand dollars each, were issued by the corporation defendants on the first day of January, 1852, in payment of a subscription of fifty thousand dollars, previously made by the order of the common council of the city, to the capital stock of the Ohio and Mississippi Railroad Company. Authority to subscribe for such stock, and to issue such bonds, under the conditions therein specified, is conferred upon the corporation by the eighteenth section of their charter. Said bonds were negotiable, and were made payable in twenty-five years from date, with interest at six per cent. per annum. Interest warrants, or coupons, were attached to the several bonds, for the payment of each year's interest, till the principal of the bonds should fall due.

Plaintiffs became the holders for value of all of the bonds, together with the coupons thereto attached, and the defendants having neglected and refused to pay the interest for the three years specified in the record, the plaintiffs brought an action of assumpsit, to recover the amount of the unpaid interest, as represented in the respective coupons for those years. Their claim was set forth in the declaration in a special count, alleging the substance of the facts as above stated, and the declaration also contained a second count for goods sold and delivered, which also embraced the common counts. Separate demurrers were filed to the respective counts, but they were overruled by the court, and were afterwards withdrawn by the defendants. They also pleaded the general issue, called, in the record, the first plea, which was subsequently withdrawn.

Seven special pleas, numbered from two to eight, inclusive, were also filed by the defendants to the special count, but the withdrawal of the general issue left the second count without any answer.

Second plea alleged that the bonds and coupons described in the special count, were issued without any good or valuable consideration.

Third plea alleged that the corporation was not authorized to issue the bonds to the railroad company, because the company was not chartered to construct a railroad to the city.

Fourth plea alleged that a majority of the qualified voters of the city did not, at an annual election, signify their assent to the making of the subscription to the stock, as required by law.

Fifth plea alleged that the bonds and coupons were null and void, because the railroad company was not a company chartered to make a road to said city.

Sixth plea alleged that the bonds and coupons were null and void, because the subscription to the stock was made, and the bonds and coupons were issued, before the road was located to the city, and before the railroad company had determined to make the location.

Seventh plea alleged that the bonds and coupons were null and void, because the stock of the company, before it was issued to the defendants, became of no value through the mismanagement of the directors, and was wholly worthless.

Eighth plea alleged that the bonds and coupons were null and void, because the proper officers of the city never sold and delivered them, as required by law, but that the company obtained the possession of the same without such sale, and without authority.

Notice to the plaintiffs of the respective defences, so pleaded, is alleged in each of the several pleas. Six only, of the eighteen replications filed by the plaintiffs, remain to be examined, as all the rest of the series were subsequently withdrawn without objection, or were held to be bad on demurrer.

Those not withdrawn, are the first, second, fifth, sixth, eighth, and tenth of the series, as appears by a careful inspection of the transcript. Of these, the first was to the second plea, and set up a former judgment rendered in favor of the plaintiffs, May Term, 1856, of the Circuit Court for the County of Dearborn, in the State of Indiana, in a certain action brought by the plaintiffs against the defendants, to recover the amount of the coupons attached to the same fifty bonds, which fell due the first day of January next preceding the rendition of the judgment, and the plaintiffs prayed judgment, if the defendants ought to be admitted to aver against that record, that the bonds and coupons were issued without any good or valuable consideration.

Second replication was to all the pleas, except the first, and set up a former judgment recovered by the plaintiffs, May Term, 1857, in the Circuit Court of the United States for the District of Indiana, in an action of assumpsit, against the defendants, for the amount of another set of the coupons attached to the same fifty bonds.

Fifth replication was to the third, fourth, fifth, sixth, seventh, and eighth pleas, and also set up the judgment recovered in the Circuit Court of Dearborn County, as described in the first replication, and substantially in the same form.

Sixth replication was to the fourth plea only, and set up the same judgment, and in the same form as pleaded in the fifth replication.

Eighth replication was also to the fourth plea, and alleged that the defendants were estopped, by the recital in the bonds, from denying that a majority of the qualified voters of the city, at an annual election, signified their assent to the subscription.

Tenth replication was to the third, fifth, and sixth pleas, and set up the proceedings of the city council therein recited, as an answer to the said several pleas.

Defendants demurred specially to each of the several replications, but the court overruled the respective demurrers, and held that the several replications were sufficient.

Leave was granted to the defendants, at the same time, to rejoin, and on a subsequent day they appeared and filed a rejoinder to the second replication.

Parties also filed an agreement, at the same time, to the effect that the rejoinder should be regarded as pleaded to all the replications adjudged good, except the tenth, which was the second replication to the third, fifth, and sixth pleas.

Substance and effect of the matters alleged in the rejoinder were, that the plaintiffs recovered another judgment against the defendants in the Circuit Court for said Dearborn County, in a suit founded on another and different set of the coupons attached to the same fifty bonds, and that the Supreme Court of the State, on appeal, reversed the judgment for error, and remanded the cause for further proceedings.

Plaintiffs demurred to the rejoinder, and the court sustained the demurrer, and held that the rejoinder was bad. Thereupon the parties waived a jury, and submitted the cause to the court for the assessment of damages, and the court, having heard all the evidence introduced by the parties, rendered judgment for the plaintiffs in the sum of ten thousand five hundred and thirty-four dollars and fifty cents damages, and costs of suit.

1. Judgment having been rendered for the plaintiffs, the defendants tendered a bill of exceptions, which was allowed by the presiding justice, and signed and sealed. Statement in the bill of exceptions is, that the parties submitted the cause to the court upon the record and the evidence therein set forth; but it is obvious that, when it was submitted, there was nothing left to be done except to compute the damages.

None of the pleadings terminated in issues of fact, except such as had been withdrawn or waived by one side or the other, and all the issues of law had been determined against the defendants. When the defendants withdrew the general issue, and left the second count in the declaration without any answer, the plaintiffs, as upon nil dicit, might have moved for judgment for the want of a plea, but they did not submit any such motion, and both parties proceeded thereafter throughout the trial as if there was but one count in the declaration.

Viewed in the light of the proceedings in the suit, subsequent to the withdrawal of the general issue, it must be understood that the second count was waived, as there is not a word in the record to support the proposition assumed by the plaintiffs, that the judgment was rendered on that count.

2. Every issue of fact having been withdrawn, and every issue of law in which the other pleadings terminated having been decided in favor of the plaintiffs, they were clearly entitled to judgment on the first count. Irrespective, therefore, of the bill of exceptions, the writ of error brings here for review the decisions of the court below, in overruling the demurrer of the defendants to the tenth replication of the plaintiffs, and in sustaining the demurrer of the plaintiffs to the rejoinder of the defendants as filed to the first, second, fifth, sixth, and eighth replications of the plaintiffs.

Such being the state of the case the decisions of the court below may be re-examined in this court without any bill of exceptions, as the questions are apparent in the record, and arise upon demurrers to material pleadings on which the cause depends.

3. Examination of the questions growing out of the decision of the court below in sustaining the demurrer to the defendants' rejoinder will first be made, because if the objections taken to that decision are overruled, the questions involved in the other decision will be of no importance, as the plaintiffs in any event must prevail, and the judgment of the Circuit Court must be affirmed. They must prevail in that event, because the several replications to which that rejoinder was filed, as extended and applied by the agreement of the parties, furnish a complete answer to all the special pleas of the defendants.

Before proceeding to consider the questions growing out of that decision of the court below, it should be remembered that the defendants, in filing the rejoinder, waived their demurrers to all the replications to which it was filed. Applied as it was by the agreement, to all the replications not abandoned, except the tenth, it follows that all the demurrers except that filed to the tenth replication were waived.

Pleading over to a declaration adjudged good on demurrer is a waiver of the demurrer, and when a defendant files a rejoinder to a replication, previously adjudged good on demurrer, his act in pleading over must for the same reason be held to have the same effect.

4. Extended argument to show that the matters alleged in the rejoinder are not of a character to constitute a sufficient answer to the several replications to which it was filed is unnecessary, as it is scarcely so contended by the defendants. Undoubtedly the view of the pleader was to set up an estoppel against the matters pleaded by the plaintiffs in their first, second, fifth, sixth, and eighth replications, and to claim the benefit of the rule that an estoppel against an estoppel opens up the whole matter and sets it at large; but the insuperable difficulty in the way of the attempt to apply that rule, even supposing that the former judgments are pleaded as technical estoppels, is that the matters pleaded in the rejoinder do not amount to an estoppel, as they merely show that the judgment for the plaintiff, as recovered in that case in the court of original jurisdiction, was reversed in the appellate tribunal, and that the cause was remanded to the subordinate court for further proceedings. Second trials often result in the same way as the first, and certainly the reversal of the judgment under the circumstances shown in the allegations of the rejoinder is not conclusive evidence that the plaintiffs may not ultimately recover. Unless a final judgment or decree is rendered in a suit the proceedings in the same are never regarded as a bar to a subsequent action. Consequently where the action was discontinued, or the plaintiff became nonsuit, or where from any other cause, except perhaps in the case of a retraxit, no judgment or decree was rendered in the case, the proceedings are not conclusive.

5. Suppose the rejoinder is bad, still the defendants contend that the replications to which it was filed, are also bad, and that they are entitled to judgment, as the first fault in pleading was committed by the plaintiffs. Doubts were entertained at first whether, inasmuch as the demurrers were abandoned after the replications had been adjudged good, the point was open to the defendants; but the better opinion is, that the waiver of the demurrers left the rights of the parties in the same condition as they would have been if the demurrers had never been filed. Conceding that to be the rule, then it is clear that the defendants may go back and attack the sufficiency of the replications, as it is the settled rule of law in this court in respect to demurrers, that although the pleadings demurred to may be bad, the court will nevertheless give judgment against the party whose pleading was first defective in substance.

Statement of the rule by Stephen is, that on demurrer to the replication, if the court think the replication bad, but perceive a substantial fault in the plea, they will give judgment, not for the defendant but for the plaintiff, provided the declaration be good; but if the declaration also be bad in substance, then upon the same principle judgment would be given for the defendant.

Apart, therefore, from their own demurrers, and solely by virtue of the plaintiffs' demurrer to their rejoinder, the defendants may go back and attack the plaintiffs' replications, but they can do so only as to defects of substance, as it is well settled that the rule applies only where the antecedent pleading is bad in substance, and that it does not extend to mere matters of form. Mere formal objections, therefore, to the replications, will not be noticed, as such objections are not open under the pleadings in this record.

6. Four of the replications set up the two former judgments, and as they involve the same questions, they will all be considered together. Duly exemplified copies of those judgments are exhibited in the transcript, and they are well described in the replications. When the record of a former judgment is set up as establishing some collateral fact involved in a subsequent controversy, it must be pleaded strictly as an estoppel, and the rule is, that such a pleading must be framed with great certainty, as it cannot be aided by any intendment. Technical estoppels, as contended by the defendants, must be pleaded with great strictness, but when a former judgment is set up, in bar of an action, or as having determined the entire merits of the controversy, it is not required to be pleaded with any greater strictness than any other plea in bar, or any plea in avoidance of the matters alleged in the antecedent pleading of the opposite party.

Same rule applies to a replication as to a plea, as the plaintiff cannot anticipate what the defence will be when he frames his declaration. Cases arise, also, where the record of the former suit does not show the precise point which was decided in the former suit, or does not show it with sufficient precision, and also where the party, relying on the former recovery, had no opportunity to plead it; but it is not necessary to consider those topics, as no such questions are directly presented in this case for decision.

Aside from all these questions, and independent of the form of the replications, the defendants make two objections to the theory, that the former judgments, set up in this case, are a conclusive answer to the respective defense pleaded in their several special pleas.

First. They contend that a judgment on demurrer is not a bar to a subsequent action between the same parties for the same cause of action, unless the record of the former action shows that the demurrer extended to all the disputed facts involved in the second suit, nor unless the subsequent suit presents substantially the same questions as those determined in the former suit. Where the second suit presents no new question, they concede that the judgment in the former suit, though rendered on demurrer, may be a bar to the second suit, but they maintain that it can never be so regarded, unless all those conditions concur.

Secondly. They also deny that a former judgment is, in any case, conclusive of any matter or thing involved in a subsequent controversy, even between the same parties for the same cause of action, except as to the precise point or points actually litigated and determined in the antecedent trial; and they insist that none of the defences set up in their several special pleas were directly presented and determined in either of the former suits, as supposed by the plaintiffs.

7. Identity of the parties, in the former suits, with the parties in the suit at bar, is beyond question, and it cannot be successfully denied that the cause of action, in the former suits, was the same as that in the pending action, within the meaning of that requirement, as defined by decided cases of the highest authority. Where the parties are the same, the legal effect of the former judgment as a bar is not impaired, because the subject-matter of the second suit is different, provided the second suit involves the same title, and depends upon the same question. Second suit for trespass was held, in the case of Outram v. Morewood, to be barred by the record of a former judgment, between the same parties, recovered long before the second trespass was committed, as it appeared that the same title was involved in both cases. Precisely the same rule was also laid down in the case of Burt v. Sternburgh, and the reason assigned in its support was, that the plaintiffs' right of recovery, and the defence set up in the second action, depended on the same title as that involved in the former suit. So, where an importer and two sureties executed two bonds for duties, and the principal being insolvent, one of the sureties paid the whole amount and brought a suit against the other surety for contribution on the bond which first fell due, and was defeated, on a plea of release, by the obligee, with his own consent, the judgment was held in a subsequent suit for contribution for the amount paid on the other bond, to be a conclusive bar to the second claim, it appearing that both bonds were given at the same time, upon the same consideration, and as parts of one and the same transaction.

Different bonds, it will be noticed, were described in the two declarations, but the decision of the court was placed upon the ground, that the cases were precisely alike, as to the right of the plaintiff to demand, and the duty of the defendant, as a co-surety, to make contribution. Nothing is better settled, say the court, than that the judgment of a court of concurrent jurisdiction, directly upon the point made in the suit, is conclusive between the same parties, upon the same subject-matter, and they referred to the case of Gardner v. Buckbee, as directly in point, and there can be no doubt that it is entirely analogous.

Substance of the material facts in that case was, that two notes had previously been given by the defendant for the purchase-money of a vessel, which he refused to pay; and in the suit on the first note the defence was, that it had been obtained by fraud, and the judgment was for the defendant; and in a subsequent suit on the other note, that judgment was held to be conclusive as to the question of fraud.

Weighed in the light of those decisions, it is quite clear that the cause of action, in the legal sense, is the same in the case at bar as that in the respective former judgments set up in the four replications under consideration.

In the suit determined in the State court, the declaration alleged to the effect that the defendants, under the authority conferred on the corporation by virtue of their charter, subscribed for fifty thousand dollars of the stock of the railroad company; that the company was chartered to construct, and was then constructing a railroad to said city; that a majority of the qualified voters of the city signified their assent to the subscription by expressing on their tickets, at an annual election in said city, that they were in favor of the same; that the defendants issued and sold the bonds to raise the funds to pay for the stock, and that the plaintiffs purchased the bonds and became the holders of the same and of the coupons thereto attached.

Defendants demurred to the declaration, but the court overruled the demurrer, and they subsequently filed an answer, setting up two defences: 1. That the location of the railroad was not established through the city till after the subscription. 2. That the company was not chartered to construct, and was not, at the date of the subscription, constructing a railroad to the city.

Plaintiffs demurred to the first answer, and the demurrer was sustained by the court; and to the second defence they replied that the company located their railroad through the city before the bonds were delivered, and the defendants demurred to the replication, but the court overruled the demurrer.

Concluding statement of the record is, that 'the said city, not desiring to controvert the facts stated in said reply, but admitting the same,' judgment is rendered for the plaintiffs.

Second judgment set up in the replications, was rendered in the Circuit Court of the United States, in a suit on another set of the coupous attached to the same fifty bonds, and the declaration alleged that the defendants, by virtue of the power conferred in their charter, did lawfully and in due form execute and issue the bonds under the seal of the corporation, and that the plaintiffs, for a valuable consideration, became the legal holders and bearers of the same, and of the coupons thereto attached.

Special demurrer to the declaration was filed by the defendants, and they showed for cause, among other things, that it did not allege that the bonds were issued in pursuance of such a vote of the inhabitants of the city as the charter required. Both parties were heard, and the court overruled the demurrer and gave judgment against the defendants for the amount of the coupons, with interest. Inspection of those records, therefore, shows that the several questions involved in the present suit, as to the validity of the bonds, the time and place of the location of the railroad, and the alleged failure to secure the antecedent assent of a majority of the qualified voters of the city, were all put in issue in those cases. They were not only put in issue but they were determined, unless it be denied that the effect of a demurrer to the declaration or other pleading, is that it admits all such matters of fact as are sufficiently pleaded. Such a denial, if made, would be entitled to no weight, as it is a rule universally acknowledged.

Foundation of the rule is that the party demurring, having had his option to plead or demur, shall be taken, in adopting the latter alternative, to admit that he has no ground for denial or traverse.

On the overruling of a demurrer, the general rule is that judgment for the plaintiff is final if the merits are involved, but a judgment that a declaration is bad, cannot be pleaded as a bar to a good declaration for the same cause of action, because such a judgment is in no just sense a judgment upon the merits. Other exceptional cases might be named, but it is unnecessary, as none of them can have any bearing on this case.

Taken as a whole, the pleadings of the defendants in the respective cases amounted to a demurrer to the respective declarations, and the substantial import of the decision of the court in each case, was that the declaration was sufficient to entitle the plaintiffs to judgment. Beyond question they were judgments on the merits, although rendered on demurrer; and in such case the well-settled rule is that every material matter of fact sufficiently pleaded is admitted.

Since the resolution in Ferrer's Case, the general principle has always been conceded, that when one is barred in any action, real or personal, by judgment on demurrer, confession, or verdict, he is barred as to that or the like action of the like nature for the same thing forever.

Objection was taken in the case of Bouchaud v. Dias, that the former judgment between the parties could not be a bar to the subsequent action, because it was rendered on demurrer to the defendant's plea, but the court held that it made no difference in principle whether the facts upon which the court proceeded were proved by competent evidence, or whether they were admitted by the parties; and they also held that an admission, by way of demurrer to a pleading, in which the facts are alleged, must be just available to the opposite party as though the admission had been made ore tenus before a jury.

Reference to cases decided in other jurisdictions, however, is unnecessary, as this court decided, in the case of Clearwater v. Meredith, that on demurrer to any of the pleadings which are in bar of the action, the judgment for either party is the same as it would have been on an issue of fact joined upon the same pleading, and found in favor of the same party.

Defence of a former judgment rendered upon general demurrer to the declaration was also set up in the case of Goodrich v. The City, and this court held that it was a good answer to the suit, although the appellant insisted that it was not, because the judgment was rendered on demurrer.

8. Unsupported as the second proposition of the defendants is, as to the theory of fact on which it is based, it will not require any extended consideration. Much doubt and perhaps uncertainty exist in judicial decisions as to the limits, in certain cases, within which the conclusive effect of a judgment is confined by law as expressed in the maxim, Nemo debet bis vexari pro una et eadum causa, and also as to the manner in which the former judgment in that class of cases should be taken advantage of by the party.

But it is believed that the case at bar may be decided without encountering any of those conflicting opinions, as they occur chiefly where the party claiming the benefit of the former judgment failed to plead it at the first opportunity, or where no such opportunity was presented, and it was introduced under the general issue. Decisions made in such cases were cited at the argument, but they afford very little aid in the solution of any question arising in this record. Remark should also be made, that the several replications set up the former judgments, not merely as settling some collateral fact involved in the case, but as having determined the entire merits of the controversy involved in the pleadings.

Such a case falls directly within the rule that the judgment of a court of concurrent jurisdiction, or one in the same court directly on the point, is, as a plea, a bar, and conclusive between the same parties upon the same matter directly in question in a subsequent action.

When not pleaded, but introduced as evidence under the general issue, the judgment, it was said in that case, was equally conclusive between the parties; but that point will not be considered in this case, as it is in no manner involved in the pleadings. Express determination of the court, also, in the case of Outram v. Morewood, was, that the rule that a recovery in one action is a bar to another, is not confined to personal actions alone, but tht it extends to all actions, real as well as personal.

Repeated decisions established the rule, in the early history of the common law, that where a judgment was rendered on the merits it barred all other personal suits, except such as were of a higher nature, for the same cause of action.

Judgment in a writ of entry is not a bar to a writ of right; but the meaning of the rule is, that each species of judgment is equally conclusive upon its own subject-matters by way of bar to future litigation for the thing thereby decided. Hence, the verdict of a jury, followed by a judgment or a decree in chancery, as held by this court, puts an end to all further controversy between the parties to such suit, and it has already appeared that a judgment for either party on demurrer to a pleading involving the merits, is the same as it would have been on an issue in fact, joined upon the same pleading, and found in favor of the same party.

Determination of this court, in the case of Aspden v. Nixon, was that a judgment or decree, in order that it may be set up as a bar, must have been rendered by a court of competent jurisdiction upon the same subject-matter, between the same parties, and for the same purpose; and in the case of Packet Co. v. Sickles, the decision was, that 'the essential conditions under which the exception of the res judicata becomes applicable are the identity of the thing demanded, the identity of the cause of the demand, and of the parties in the character in which they are litigants.' Attempt was made in that case, as in this, to maintain that the judgment in the first suit could not be held to be an estoppel, unless it was shown by the record that the very point in controversy was distinctly presented by an issue, and that it was explicitly found by the jury; but the court held otherwise, and distinctly overruled that proposition, although the defence of estoppel failed for other reasons.

Courts of justice, in stating the rule, do not always employ the same language; but where every objection urged in the second suit was open to the party within the legitimate scope of the pleadings in the first suit, and might have been presented in that trial, the matter must be considered as having passed in rem judicatam, and the former judgment in such a case is conclusive between the parties.

Except in special cases, the plea of res judicata, says Taylor, applies not only to points upon which the court was actually required to form an opinion and pronounce judgment, but to every point which properly belonged to the subject of litigation, and which the parties, exercising reasonable diligence, might have brought forward at the time.

Substantially the same rule was laid down in the case of Outram v. Morewood, in which the court said that 'a recovery in one suit upon issue joined on matter of title, is equally conclusive upon the subject-matter of such title' in any subsequent action, as an estoppel.

Better opinion is, that the estoppel, where the judgment was rendered upon the merits, whether on demurrer, agreed statement, or verdict, extends to every material allegation or statement which, having been made on one side and denied on the other, was at issue in the cause, and was determined in the course of the proceedings.

The allegation in the case of Ricardo v. Garcias, was, that the matters in issue on the second suit were the same, and not in any respect different from the matters in issue in the former suit, and the House of Lords held that the plea was sufficient evidently deciding that nothing was open in the second suit which was within the scope of the issue in the former trial. Properly construed, the opinion of this court on this point in the case of the Packet Company v. Sickles, is to the same effect, as plainly appears in that part of it in which the court say that if the record of the former trial shows that the verdict could not have been rendered without deciding the particular matter in question, it will be considered as having settled that matter as to all future actions between the parties. Applying that rule to the case at bar it is clear that a judgment rendered on demurrer settles every matter which was well alleged in the pleadings of the opposite party.

9. Separate examination of the authorities cited by the defendants, in view of their number, is impracticable, but it will appear, if they are carefully read and rightly applied, that they do not support the proposition under consideration. On the contrary, the decision of the court in the case of Gilbert v. Thompson, is that a judgment in a former action is conclusive where the same cause of action was adjudicated between the same parties, or the same point was put in issue on the record and directly found by the verdict of a jury; and the case of Merriam v. Whittemore et al., is precisely to the same effect. Unguarded expressions are found in the opinions in the case of Carter v. James, but the decision turned upon the point that the cause of action was not the same in the pending suit as that litigated in the former action. For these reasons our conclusion is that the decision of the Circuit Court in sustaining the demurrer of the plaintiffs to the rejoinder of the defendants was correct, and that the plaintiffs were thereupon entitled to judgment.

10. In such cases, where the sum for which judgment should be rendered is uncertain, the rule in the Federal courts is that the damages shall, if either of the parties request it, be assessed by a jury.

But if the sum for which judgment should be rendered is certain, as where the suit is upon a bill of exchange or promissory note, the computation may be made by the court, or what is more usual, by the clerk; and the same course may be pursued even when the sum for which judgment should be rendered is uncertain if neither party request the court to call a jury for that purpose. Common law rules were substantially the same, except that 'the court themselves might, in a large class of cases, if they pleased, assess the damages, and thereupon give final judgment.'

Evidently a jury in this case was not necessary, but it was not error to hear proofs under the submission, as both parties assented to the course pursued.

Exceptions were taken to the ruling of the court in allowing interest upon the coupons, and the bill of exceptions states that the exception of the defendants was allowed, but it does not state what amount of interest was included in the judgment, nor give the basis on which it was computed. Judging from the amount of the sum found due, it is, perhaps, a necessary inference that interest was allowed on each coupon from the time it fell due to the date of the judgment, and if so, the finding was correct.

Bonds and coupons like these, by universal usage and consent, have all the qualities of commercial paper. Coupons are written contracts for the payment of a definite sum of money, on a given day, and being drawn and executed in a form and mode for the very purpose that they may be separated from the bonds, it is held that they are negotiable, and that a suit may be maintained on them without the necessity of producing the bonds to which they were attached. Interest, as a general rule, is due on a debt from the time that payment is unjustly refused, but a demand is not necessary on a bill or note payable on a given day. Being written contracts for the payment of money, and negotiable because payable to bearer and passing from hand to hand, as other negotiable instruments, it is quite apparent on general principles that they should draw interest after payment of the principal is unjustly neglected or refused. Where there is a contract to pay money on a day fixed, and the contract is broken, interest, as a general rule, is allowed, and that rule is universal in respect to bills and notes payable on time. Governed by that rule this court in the case of Gelpcke v. Dubuque, held that the plaintiff, in a case entirely analogous, was entitled to recover interest.

Necessity for remark upon the other exceptions is superseded by what has already been said in respect to the plaintiff's demurrer.

JUDGMENT AFFIRMED, WITH COSTS.


text: Talk:Aurora City v. West/Opinion of the Court

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


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Durant v. Essex Company (74 U.S. 107)

APPEAL from the Circuit Court for the District of Massachusetts.

The Constitution vests appellate jurisdiction in the Supreme Court under such regulations as Congress shall make, and Congress, by the act of March 3, 1803, authorizing appeals, provides that 'the said Supreme Court shall be, and hereby is, authorized and required to receive, hear, and determine such appeals.'

With these provisions in force, Durant filed a bill, in October, 1847, against the Essex Company, seeking to hold it liable for certain real estate. The bill was finally 'dismissed.' An appeal was taken to this court, where, after hearing the case, the judges were equally divided in opinion; and in conformity with the practice of the court in such cases it ordered that the decree of the court 'be affirmed with costs.'

The complainant, conceiving that as the judgment in this court was by a bench equally divided, there had been no decision of his case by the court of last resort, filed another bill-the bill in the court below-for the same relief in the same matter as he had filed the one before.

The defendant pleaded that the former suit and decree in this court-which the plea averred were made after testimony was taken on both sides, and the case heard on its merits and argued by counsel-were a bar to the present bill. This was determined by the court below to be so; and the mandate of this court being filed, the complainant moved for leave to discontinue the suit, or that the bill be dismissed without prejudice. But the court refused leave, and dismissed the bill, no words being put in the decree that showed that the dismissal was other than an absolute one. Appeal here accordingly.

The questions which the appellant now sought to raise were:

1. Whether the decree of dismissal simply was a bar to a new suit?

2. What was the effect of an affirmance by an equally divided court?

Mr. Boyce, for the appellant, contended:

1. That the decree in the first suit being simply one of dismissal, did not prevent the filing of a new bill in another court, or even in the same court.

2. That an affirmance by an equally divided court amounted to nothing; that this court, upon appeal, must 'determine such appeal,' and that a decree by a divided court was not a compliance with the act of Congress. It was an abdication of the appellate power, and, in effect, imparted the power to the Circuit Court.

Messrs. Merwin and Storrow, contra, considering the first point made plainly untenable, were proceeding to the second, when they were stopped by the court; Grier, J., referring them to a note of the late Horace Binney Wallace, Esq., of Philadelphia, appended to the case of Krebs v. The Carlisle Bank, as to the effect of an affirmance of judgment by an equally divided court, which he said was 'clear and satisfactory.'

Mr. Justice FIELD delivered the opinion of the court.

title: Durant v. Essex Company (74 U.S. 107)


text: Talk:Durant v. Essex Company (74 U.S. 107)


text:
Durant v. Essex Company (74 U.S. 107)/Opinion of the Court

The decree dismissing the bill in the former suit in the Circuit Court of the United States being absolute in its terms, was an adjudication of the merits of the controversy, and constitutes a bar to any further litigation of the same subject between the same parties. A decree of that kind, unless made because of some defect in the pleadings, or for want of jurisdiction, or because the complainant has an adequate remedy at law, or upon some other ground which does not go to the merits, is a final determination. Where words of qualification, such as 'without prejudice,' or the terms indicating a right or privilege to take further legal proceedings on the subject, do not accompany the decree, it is presumed to be rendered on the merits.

Accordingly, it is the general practice in this country and in England, when a bill in equity is dismissed without a consideration of the merits, for the court to express in its decree that the dismissal is without prejudice. The omission of the qualification in a proper case will be corrected by this court on appeal.

In the case in the Circuit Court we are not left to conjectures, or to presumptions, as to what was intended by the decree. The plea of the defendants avers, that testimony was taken on both sides, and that the case was heard on its merits, and argued by counsel. And when the mandate of this court was filed, the complainant moved for leave to discontinue the suit, or that the bill be dismissed without prejudice; but the motion was denied and the decree was affirmed.

There is nothing in the fact that the judges of this court were divided in opinion upon the question whether the decree should be reversed or not, and, therefore, ordered an affirmance of the decree of the court below. The judgment of affirmance was the judgment of the entire court. The division of opinion between the judges was the reason for the entry of that judgment; but the reason is no part of the judgment itself.

It has long been the doctrine in this country and in England, where courts consist of several members, that no affirmative action can be had in a cause where the judges are equally divided in opinion as to the judgment to be rendered or order to be made. If affirmative action is necessary for the further progress of the cause, the division operates as a stay of proceedings. If the affirmative action sought is to set aside or modify an existing judgment or order, the division operates as a denial of the application, and the judgment, or order, stands in full force, to be carried into effect by the ordinary means.

Thus, in Inveson v. Moore, a verdict was rendered for the plaintiff, and according to the practice prevailing in the English courts, a rule was entered for judgment nisi. Afterwards a rule was obtained that the judgment should be arrested nisi-that is, unless cause be shown against the arrest. On motion to discharge this latter rule the judges were equally divided, and no order could be made. But the court said, if 'It had been divided on the first motion [that is, the motion against the judgment under the general rule], the plaintiff might have entered judgment; but now this rule [in arrest] must stand or be discharged, and discharged it cannot be, for the court is equally divided.' The inability of the court, from the division, to take affirmative action, would have allowed the plaintiff to enter his judgment under the general rule if no order in arrest has been made; but that being made, the position of the parties was charged.

In Chapman v. Lamphire, the plaintiff obtained a verdict, upon which the usual rule was entered for judgment nisi, in accordance with the established practice. A motion was then made for the arrest of the judgment, and it is reported that 'the judges were divided in opinion, two against two, and so the plaintiff had his judgment, there being no rule made to stay it, so that he had his judgment upon his general rule for judgment; but if it had been upon a demurrer or special verdict, then it would have been adjourned to the Exchequer Chamber.'

By a law of England, passed as long ago as 14 Edward III, if the judges of the King's Bench, or Common Pleas, are equally divided, the case is to be adjourned to the Exchequer Chamber, and be there argued before all the justices of England. If these are equally divided, it is to be determined at the next Parliament by a prelate, two earls, and two barons, with the advice of the lords chancellor, and treasurer, the judges, and other of the king's council.

In the case of the special verdict, affirmative action would be required to enter judgment, which would be impossible from the division of the judges. But in the case of the demurrer, the effect of a division would depend, we think, upon the rules of practice established in such cases, for in the absence of a settled practice or general rule of court upon the subject, the judges disagreeing as to the demurrer might disagree also as to the effect of their inability to decide it, as was the fact in this court in the case between the commonwealth of Virginia and West Virginia, argued upon demurrer to the bill at the last term.

In cases of appeal or writ of error in this court, the appellant or plaintiff in error is always the moving party. It is affirmative action which he asks. The question presented is, shall the judgment, or decree, be reversed? If the judges are divided, the reversal cannot be had, for no order can be made. The judgment of the court below, therefore, stands in full force. It is, indeed, the settled practice in such case to enter a judgment of affirmance; but this is only the most convenient mode of expressing the fact that the cause is finally disposed of in conformity with the action of the court below, and that that court can proceed to enforce its judgment. The legal effect would be the same if the appeal, or writ of error, were dismissed.

The Antelope, and Etting v. The Bank of the United States, are cases where the decisions of the court below, or some part of them, were affirmed upon a division of the judges, and a term seldom passes in which there are not several cases disposed of in this way. In Brown v. Aspden, Chief Justice Taney observed that there was no difference between a decree in chancery and a judgment at law as to its affirmance on a division of the court. 'In both cases,' he said, 'the motion is to reverse, and if that fails, the judgment, or decree, necessarily stands.'

It is also the practice of the Exchequer Chamber in England to affirm the judgment of the court below, brought before it on a writ of error, when the judges are equally divided. Where a case is adjourned to that court, under the statute of 14 Edward III, upon a division of the judges of the court below, the practice, as we have stated, is different. But on writs of error it is similar to that followed by this court. Such, also, is the practice of the House of Lords when sitting as a court of appeals. It is said that this practice depends upon the manner in which the Lords put the question, which is always in this form: Shall this judgment, or decree, be reversed? But that is the question in all appellate courts, and the particular manner in which the question is stated, cannot change the rule of law on the subject.

The statement which always accompanies a judgment in such case, that it is rendered by a divided court, is only intended to show that there was a division among the judges upon the questions of law or fact involved, not that there was any disagreement as to the judgment to be entered upon such division. It serves to explain the absence of any opinion in the cause, and prevents the decision from becoming an authority for other cases of like character. But the judgment is as conclusive and binding in every respect upon the parties as if rendered upon the concurrence of all the judges upon every question involved in the case.

JUDGMENT AFFIRMED.


text: Talk:Durant v. Essex Company (74 U.S. 107)/Opinion of the Court


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Kendall v. United States (74 U.S. 113)

APPEAL from the Court of Claims.

A. and J. Kendall made an agreement, in the year 1843, with persons representing a branch of the Cherokee tribe of Indians, called the Western Cherokees, to prosecute a claim which these Indians set up against the United States. It was a part of the agreement that the Kendalls were to receive, directly from the United States, 5 per cent. upon all sums that might be collected on the claim.

The justice of this claim, which it was thus agreed that the Kendalls should prosecute, had never been acknowledged by the United States, and the amount of it was uncertain. A treaty was finally made, in 1846, not with the Western Cherokees, who were but a part of the Cherokee tribe, but with the whole tribe; and it embraced not only the claim set up by the Western Cherokees, but many other matters, setting matters between the United States and the tribe, as also between the Western Cherokees and the main body. The treaty, as finally ratified by the Senate and by the tribe, provided that the sum of money found due (and which included moneys to the main tribe), should be held in trust by the United States, and paid out to each individual Indian, or head of a family, and that this per capita allowance should not be assignable, but should be paid directly to the person so entitled. On the 30th September, 1850, Congress made an appropriation of the amount necessary to fulfil this treaty, and the act contained a provision that no part of the money should be paid to any agents of said Indians, or to any other person than the Indian to whom it was due.

The Kendalls having thus failed to get anything from the appropriations, presented a petition to the Court of Claims. They set forth in it the fact and history of the treaty, the great labor which they had had, and the value of which their services had been in procuring the treaty and appropriation (with interest, about $887,000); all, as they alleged, due to those services. That they had repeatedly given specific notice to Congress and to its committees, and to all proper officers of the government, of the contract made by them with the Indians, and of their claim under it, and of the justice of the same.

There was no answer or evidence produced on the other side.

The Court of Claims dismissed the petition.

Messrs. Carlisle and McPherson, for the appellants:

1. The contract and order given by the Indians operated as a valid assignment of one-twentieth part of the amount due the Indians; it being settled that, in equity, an order given by a debtor to his creditor, upon a third person, having funds of the debtor, to pay the creditor out of such funds, is a binding equitable assignment of so much of the fund; and these rights of assignees being recognized and protected in courts of law.

2. Neither the treaty of 1846, nor the act of 1850, prohibited the payment of this claim. It is true that there are in the treaty provisions intended to secure to the Indian himself the amount due to him; but, while the treaty prohibits payment to any agent of an Indian, and prohibits, prospectively, any assignment of the share of any Indian, it is silent as to any existing assignment, and uses no words applicable to an assignment made by the body of the tribe out of the gross sum. The act of 1850 is more comprehensive in its language, but it was made simply to carry into effect the treaty, and its terms are to be construed in connection with the treaty itself.

Mr. Dickey, Assistant Attorney-General, contra:

1. The pretended assignment, by the Indians, of a portion of their claim, could not, if valid, be enforced in a court of law.

The Court of Claims has no equity jurisdiction.

2. The assignment was not valid unless recognized to be so by the United States.

3. The treaty of 1846, and the act of 1850, prohibited the payment of this claim.

The justice or injustice of this action of the government, is not a matter for the consideration of the Court of Claims. The case of the appellants stands upon the legal effect of their agreement with the Indians, and there is nothing in it which can override the action of the treaty-making and the law-making powers of the government.

Mr. Justice MILLER delivered the opinion of the court.

title: Kendall v. United States (74 U.S. 113)


text: Talk:Kendall v. United States (74 U.S. 113)


text:
Kendall v. United States (74 U.S. 113)/Opinion of the Court

As the case was decided on demurrer, or what is equivalent to a demurrer, the statements of the petition must be taken to be true. They show a faithful and laborious performance of their contract by the plaintiffs, for which no compensation was ever received.

It is insisted by plaintiffs, that because the government of the United States was aware of the contract between them and the Indians, and failed to reserve and pay over to them the five per cent. which by that contract they had a right to claim of the Indians, the United States is liable to them for the amount. It is supposed that the doctrine of an equitable assignment of a debt or fund due from one person to another, by the order of the creditor to pay it to a third party, when brought to the notice of the debtor, is a sufficient foundation for the claim. But, if we concede that the government is to be treated in the present case precisely as a private individual, it is not easy to see how that doctrine can be made to apply. The debt or fund as to which such an equitable assignment can be made, must be some recognized or definite fund or debt, in the hands of a person who admits the obligation to pay the assignor; or, at least, it must be some liquidated demand, capable of being enforced in a court of justice. We apprehend that the doctrine has never been held, that a claim of no fixed amount, nor time, or mode of payment; a claim which has never received the assent of the person against whom it is asserted, and which remains to be settled by negotiation or suit at law, can be so assigned as to give the assignor an equitable right to prevent the original parties from compromising or adjusting the claim on any terms that may suit them. That is just what is claimed in this case. For it is very clear that if this equitable claim in the hands of plaintiffs was not effectual before the treaty, it can have no effect afterwards.

The treaty, by its terms, is incompatible with the claim of plaintiffs. None of the money could be paid to the plaintiffs if all of it was to be paid to the Indians individually, in proportions to be determined by their numbers.

This principle of paying to the Indians per capita was not adopted with any reference to the plaintiffs' claim as a means of exclusion. The treaty was made with the entire tribe of Cherokees, of which these Western Cherokees were but a small part; and the claims which they were urging on our government constitute a still smaller part of the matters settled by the treaty.

Land claims were adjusted, the difficulties between this branch and the main body of the tribe were arranged. Other payments were made to the main tribe, in which the rule of paying per capita was adopted. Now, the argument assumes that unless in adjusting all these important interests the United States kept in view the sum to be paid to plaintiffs, by their contract with the Indians, and provided for it, they must either make no treaty at all, or must pay their claim. It cannot be permitted that by contracting with other parties, without requiring or asking the consent of the government, any one can establish such a right to control the action of that government in making treaties or contracts.

The claim of the Western Indians was nothing more than a claim prior to the treaty. Its justice had never been admitted. Its amount was uncertain. These, together with the mode of payment, were all unsettled, and open to negotiation. Is it possible, that by making a contract with claimants to prosecute this demand against the government, the plaintiffs thereby acquired such a hold on that government, as not only made the claim good to that extent, but prevented it from compromising or settling with the claimants on the best terms to be obtained?We have no hesitation in saying that the United States, under the circumstances, had the right to make the treaty that was made, without consulting plaintiffs, or incurring any liability to them. The act of Congress which appropriated the money, only followed the treaty in securing its payment to the individual Indians, without deduction for agents. And both the act and the treaty are inconsistent with the payment of any part of the sum thus appropriated to plaintiffs.

The judgment of the Court of Claims, rejecting the demand, is therefore

AFFIRMED.


text: Talk:Kendall v. United States (74 U.S. 113)/Opinion of the Court


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Page:The Confidence Man.djvu/227

Rh "Yes, I do deny it," again, in his impulsiveness, snapping at the controversial bait, "and I will confute you there in a trice. Look, you—"

"Now, now, now, my dear fellow," thrusting out both vertical palms for double shields, "you crowd me too hard. You don't give one a chance. Say what you will, to shun a social proposition like mine, to shun society in any way, evinces a churlish nature—cold, love less; as, to embrace it, shows one warm and friendly, in fact, sunshiny."

Here the other, all agog again, in his perverse way, launched forth into the unkindest references to deaf old worldlings keeping in the deafening world; and gouty gluttons limping to their gouty gormandizings; and corseted coquets clasping their corseted cavaliers in the waltz, all for disinterested society's sake; and thousands, bankrupt through lavishness, ruining themselves out of pure love of the sweet company of man—no envies, rivalries, or other unhandsome motive to it. "Ah, now," deprecating with his pipe, "irony is so unjust; never could abide irony; something Satanic about irony. God defend me from Irony, and Satire, his bosom friend."

"A right knave's prayer, and a right fool's, too," snaping [sic] his rifle-lock.

"Now be frank. Own that was a little gratuitous. But, no, no, you didn't mean; it any way, I can make allowances. Ah, did you but know it, how much pleasanter to puff at this philanthropic pipe, than still to keep fumbling at that misanthropic rifle. As for your

title: Page:The Confidence Man.djvu/227


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Cowles v. Mercer County

ERROR to the Circuit Court for the Northern District of Illinois, the case being thus:

A statute of Illinois enacts by one section that, 'Each county established in the State shall be a body politic and corporate, by the name and style of 'The County of _____;' and by that name may sue and be sued, plead and be impleaded, defend and be defended against, in any court of record, either in law or equity, or other place where justice shall be administered;' and by another, that 'All actions, local or transitory, against any county, may be commenced and prosecuted to final judgment and execution in the Circuit Court of the county against which the action is brought.'

And the Supreme Court of Illinois has decided that a county can neither sue or be sued at common law, independent of legislative provisions, and have construed the foregoing sections of the statute to exclude the right to sue any county elsewhere than in the Circuit Court of the county sued.

In this condition of the State law, Cowles, a citizen of New York, brought suit in the Circuit Court of the United States for the Northern District of Illinois, against the supervisors of Mercer County, Illinois (a board authorized to contract for the county), upon certain bonds issued by them on behalf of the county. The defendant, relying on the statute and the interpretation of it by the highest court of the State, moved to dismiss the case for want of jurisdiction. The motion was overruled, and various other defences, already frequently settled in this court as untenable, having been also disallowed, judgment was given for the plaintiff below. The case was now brought here on error by the county.

Mr. Goudy, for the County, plaintiff in error:

So far as the laws of the State of Illinois can control this question, Cowles could not sue in the Federal court. Is there any provision of the Federal Constitution or laws superior to the State rule?

By the Constitution, the judicial power extends to controversies between citizens of different States. The right to bring a suit against a corporation has been sustained only upon the theory that the different natural persons who were members of the corporate body were in fact or conclusively presumed to be citizens of the State creating the corporation. And all the cases in which the question of jurisdiction was decided by this court were in regard to private corporations, where there was no limitation to the right to sue and be sued. The question as to whether a municipal or quasi corporation can be sued in a Federal court has never been decided by this court.

Admit that where a number of the citizens of a State are incorporated, and no limitations of the liability to sue are made in the charter, the intent is presumable to impress upon the artificial body the same liability that the natural members were under, yet the State has never parted with its power to create and establish a corporate body with such powers and liabilities as it chooses to give. A corporation is the creature of the law-making power, and has such elements, attributes, powers, rights, and liabilities, as the legislature chooses to give. It may be made with the characteristics of a natural person, or it may be made with the least conceivable elements of such a character. Its distinguishing element is perpetuity, but it may consist of one or many natural persons; it may have no right to hold real or personal property; it may be destitute of the right to contract, or to sue or be sued. Is it not competent for the legislative authority to say that a corporation may be created with power to contract which can only be enforced in a court of general jurisdiction holden where it exercises its power? Such a provision is in the nature of a privilege, like that in England where certain classes can only be sued in specified counties, and similar instances in this country. Does the mere creation of a corporation necessarily carry with it the right to make an agreement, and does that subject it to a liability to suit in all courts beyond the power of the legislature to restrain?

It is true that the members of a corporation would be liable to be sued on a cause of action against them as natural persons accrued to the citizen of another State in a Federal court. But a contract of a corporation with limited powers is not the obligation of the individual members; it is the agreement of the artificial person alone.

These observations apply with great force to municipal corporations. For the purpose of better carrying on the local government, the people of the county are made a corporate body, but not with irrevocable powers or vested rights. It is at all times subject to such changes or repeal as the legislative power chooses to make.

It was thought wise to adopt the 11th Amendment to the Constitution of the United States prohibiting all suits against a State; the same idea doubtless influenced the legislature of Illinois in providing that a body of the people of the State organized solely for local government should only be sued in the principal court of their own county. This doctrine does not impose any hardship on any person. The same statute which made a county a corporation, declared that it could only be sued in the Circuit Court within its own limits.

The CHIEF JUSTICE delivered the opinion of the court.

title: Cowles v. Mercer County


text: Talk:Cowles v. Mercer County

title: Talk:Cowles v. Mercer County


text:
Cowles v. Mercer County/Opinion of the Court

The record presents but one question which has not been heretofore fully considered and repeatedly adjudicated. That question is, whether the board of supervisors of Mercer County can be sued in the Circuit Court of the United States by citizens of other States than Illinois. It presents but little difficulty.

The board of supervisors is a corporation created by acts of the legislature of Illinois.

It has never been doubted that a corporation, all the members of which reside in the State creating it, is liable to suit upon its contracts by the citizens of other States; but it was for many years much controverted whether an allegation in a declaration that a corporation defendant was incorporated by a State other than that of the plaintiff, and established within its limits, was a sufficient averment of jurisdiction. And in all the cases, prior to 1844, it was held necessary to aver the requisite citizenship of the corporations. Then the whole question underwent a thorough re-examination in the case of The Louisville, Cincinnati, and Charleston Railroad Company v. Letson; #fn-s-s-s and it was held that a corporation created by the laws of a State, and having its place of business within that State, must, for the purposes of suit, be regarded as a citizen within the meaning of the Constitution giving jurisdiction founded upon citizenship. This decision has been since reaffirmed, and must now be taken as the settled construction of the Constitution.

In the case before us the corporators are all citizens of Illinois, and the corporation is liable to suit within the narrowest construction of the Constitution.

But it was argued that counties in Illinois, by the law of their organization, were exempted from suit elsewhere than in the Circuit Courts of the county. And this seems to be the construction given to the statutes concerning counties by the Supreme Court of Illinois. But that court has never decided that a county in Illinois is exempted from liability to suit in National courts. It is unnecessary, therefore, to consider what would be the effect of such a decision. It is enough for this case that we find the board of supervisors to be a corporation authorized to contract for the county. The power to contract with citizens of other States implies liability to suit by citizens of other States, and no statute limitation of suability can defeat a jurisdiction given by the Constitution. We cannot doubt the constitutional right of the defendant in error to bring suit in the Circuit Court of the United States upon the obligations of the County of Mercer against the plaintiff in error. And we find no error in the judgment of that court. It must, therefore, be

AFFIRMED.


text: Talk:Cowles v. Mercer County/Opinion of the Court


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Nichols v. United States

APPEAL from the Court of Claims.

An act of Congress of February 26, 1845, construing a former act relative to duties paid under protest, says:

'Nor shall any action be maintained against any collector, to recover the amount of duties so paid under protest, unless the said protest was made in writing and signed by the claimant, at or before the payment of said duties, setting forth distinctly and specifically the grounds of objection to the payment thereof.'

In this state of the statute law, Nichols & Co., merchants of New York, imported from abroad to that city, in 1847-51, certain casks of liquor. Duties were imposed at the customhouse, at New York, on the quantity invoiced; that is to say, on the amounts which the casks contained when they were shipped. A portion of the liquors, however, leaked out during the voyage, and being thus lost, was never imported at all, in fact, into the United States. Notwithstanding this circumstance, Nichols & Co. paid the duties, as imposed; that is to say, duties on the amount as invoiced, making no protest in the matter. They now, July, 1855, by petition, setting forth their case, including the fact that they had 'omitted to protest,' brought suit against the United States for the over-payment, in the Court of Claims; a court which, by the acts of Congress establishing it, has power to hear and determine 'all claims founded upon any law of Congress, or upon any regulation of an executive department, or upon any contract, express or implied, with the government of the United States.'

The petition asserted the law, as settled by this court in Lawrence v. Caswell, to be, that duty was chargeable only on the value of the liquors imported into the United States, and that the quantity lost by leakage, on the voyage of importation, was not subject to any duty. A view in conformity, as they alleged, with a Treasury circular of January 30, 1847, directing that, 'if the quantity of any article falls short of the amount given in the invoice,. . . an abatement of the duties to the extent of the deficiency will be made.'

As a reason for not presenting the claim to the Treasury Department, the petitioners stated that they omitted to protest.

The United States demurred to the petition, and the demurrer being sustained, the petition was dismissed. The importers now appealed.

Mr. William Allen Butler, for the appellants, contended, that the case was within the jurisdiction of the Court of Claims, for the claim was founded upon—

1st. A law of the United States, to wit, the Tariff Act, in operation at the time of the importations; an act which had regulated the assessment of duties on the liquors; upon—

2d. A regulation of an executive department, to wit, the Treasury; which sort of regulation the circular of January 30, 1847, was; a regulation as to deficiencies; and upon—

3d. An implied contract of the United States, springing from the obligation of the government to refund, irrespective of protests, the duties, if illegally exacted.

Viewed in the light in which the claim was placed by the act creating the Court of Claims, and by the decision in Lawrence v. Caswell, it was to be judged according to the rules of law applicable to cases where a party sues to recover money paid to another, in order to obtain possession of his goods from the latter, who has withheld them upon an illegal demand, colore officii. In such cases the law forces upon the wrongdoer the promise, in invitum, to pay the money to the party entitled to it. The Court of Claims has decided that this class of cases come within the provisions of the acts conferring jurisdiction upon the court.

Neither was a written protest, made at the time before the collector, a pre-requisite to maintain suit here. There was no law requiring importers, overcharged by collectors of customs, to pursue the remedy authorized by the act of February 26, 1845, viz.: payment of the duties under protest, and suit against the collector. They might, if they so elected, apply to Congress, by petition, for an act directing the return of the duties. So they might come into this court and ask its relief. It was only where the importer exercised his right of action against the collector, that the absence of protest in writing could affect the question of the legality of the exaction. If the exaction was wrongful, and an obligation existed on the part of the government, the principal receiving money, to repay it, that obligation, when sought to be enforced directly against the government, could not be impaired by a condition made by it, for mere security perhaps, respecting the mode of enforcing a liability for the same obligation against its agents.

Mr. Evarts, Attorney-General, and Mr. Talbot, contra:

This appeal assumes as true that, at common law, the appellant has, against the United States, a right of action to recover the moneys claimed in his petition, which right was made available by the statutes establishing the Court of Claims, under no limitations save those prescribed for proceedings in that court. The assumption is false. The common law implies no contract on the part of the government to repay money erroneously collected into the public treasury for public dues. This point sustained, the appeal fails. But further:

1. No new liability on the part of the government, in this respect, has been created by the statutes establishing or relating to the Court of Claims. This appears by the statutes themselves.

2. What the revenue statutes define to be a compulsory payment in a case like this, and that alone, is such. Everything else is voluntary.

3. At common law the payment alleged by the petition is not compulsory.

Mr. Justice DAVIS delivered the opinion of the court.

title: Nichols v. United States


text: Talk:Nichols v. United States

title: Talk:Nichols v. United States


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

1st. Was there any liability on the part of the government to refund these duties prior to the act establishing the Court of Claims?2d. If not, has that act fixed any new liability on the government?

The immunity of the United States from suit is one of the main elements to be considered in determining the merits of this controversy. Every government has an inherent right to protect itself against suits, and if, in the liberality of legislation, they are permitted, it is only on such terms and conditions as are prescribed by statute. The principle is fundamental, applies to every sovereign power, and but for the protection which it affords, the government would be unable to perform the various duties for which it was created. It would be impossible for it to collect revenue for its support, without infinite embarrassments and delays, if it was subject to civil processes the same as a private person.

It is not important for the purposes of this suit, to notice any of the acts of Congress on the subject of the payment of duties on imports, anterior to the act of February 26, 1845. This act altered the rule previously in force, and required the party of whom duties were claimed, and who denied the right to claim them, to protest in writing, with a specific statement of the grounds of objection.

Through this law Congress said to the importing merchant, you must pay the duties assessed against you; but, as you say, they are illegally assessed, if you file a written protest stating wherein the illegality consists, you can test the question of your liability to pay, in a suit against the collector, to be tried in due course of law, and, if the courts decide in your favor, the treasury will repay you; but in no other way will the government be responsible to refund.

The written protest, signed by the party, with the definite grounds of objection, were conditions precedent to the right to sue, and if omitted, all right of action was gone. These conditions were necessary for the protection of the government, as they informed the officers charged with the collection of the revenue from imports, of the merchant's reasons for claiming exemption, and enabled the Treasury Department to judge of their soundness, and to decide on the risk of taking the duties in the face of the objections. There was no hardship in the case, because the law was notice equally to the collector and importer, and was a rule to guide their conduct, in case differences should arise in relation to the laws for the imposition of duties. The allowing a suit at all, was an act of beneficience on the part of the government. As it had confided to the Secretary of the Treasury the power of deciding in the first instance on the amount of duties demandable on any specific importation, so it could have made him the final arbiter in all disputes concerning the same. After the passage of the law of 1845, the duties in controversy were paid.

The appellants say they were illegally exacted, because it was decided by this court, in Lawrence v. Caswell, that the duties ought to be charged only upon the quantity of liquors actually imported, and not on the contents stated in the invoices; but the Chief Justice took occasion to observe in deciding that case, 'that where no protest was made the duties are not illegally exacted in the legal sense of the term. If the party acquiesces, and does not by his protest appeal to the judicial tribunals, the duty paid is not illegally exacted, but is paid in obedience to the decision of the tribunal (the Secretary of the Treasury) to which the law had confided the power of deciding the question.' In view of this decision and the plain requirements of the law, how can Nicholl & Co. complain? They knew by proceeding in a certain way they could resort to the legal tribunals, and yet for a series of years they imported liquors, and paid the duties demanded without objection. They had an equal right, with the Secretary of the Treasury, to construe the law under which the duties were claimed, and as they chose not to appeal to the courts, they adopted the construction which the secretary put on the law, and are concluded by his decision. If a party who did not adopt that construction placed himself in a way to contest it, and got a decision that it was erroneous, such decision cannot enure to the benefit of Nicholl & Co., who by their conduct notified the government, so far as they were concerned, they acquiesced in the secretary's construction of the law. It may be their misfortune that they did not appeal from the secretary's decision; but it is a misfortune that occurs to any party, in a lawsuit, who refuses to appeal from the decision of an inferior court, and afterwards finds, by means of another's litigation, that if he had appealed the decision would have been reversed.

If the duties demanded of Nicholl & Co. had been paid under protest, their payment, in the sense of the law, would have been compulsory, but as they were paid without protest it was a voluntary payment, doubtless made and received in mutual mistake of the law; but in such a case, as was decided in Elliott v. Swartwout, no action will lie to recover back the money. And so this court has repeatedly held.

It is clear, therefore, that the appellants are without remedy, unless a new liability has been imposed on the government by the act creating the Court of Claims.

Does this act confer on the appellants any further or different rights than they had prior to its passage? If not, there is an end to this suit.

The Court of Claims has power to hear and determine all claims founded upon any law of Congress, or upon any regulation of an executive department, or upon any contract, express or implied, with the government of the United States.

Conceding, that this jurisdiction draws to it cases arising under the revenue laws, then it is contended, as this suit is founded on one of the tariff acts of Congress, which has been judicially interpreted so as to sustain the claim, therefore the case of the appellants is brought within the first jurisdictional clause of the act creating the Court of Claims. But this result does not follow, for if the court has decided that the appellants, if they had protested, would have been entitled to be reimbursed for the excess of duties paid by them, it has also decided, by not protesting they lost all right to ask for repayment; and there has been no law of Congress passed since this decision placing them in the position they would have been if they had protested. Neither can they invoke to their aid a regulation of the Treasury Department, which alone of all the departments deals with the question of duties on imports, for there is no regulation touching the subject, as is very evident from the averment in their petition, that the Treasury Department would not pay them because they omitted to protest.

Besides, if there had been a regulation of the department on the subject, it could not affect the rights of the appellants, for such a regulation cannot change a law of Congress.

It is insisted, however, if this suit cannot be sustained on these grounds, it can be sustained on an implied contract springing from the obligation of the government to refund all duties that are illegally exacted. But we have seen that these duties were not illegally exacted, were paid voluntarily, and there is no such thing as an implied promise to pay against the positive command of a statute.

Enough has been said to show that if the Court of Claims could take jurisdiction of this class of cases, its judgment was right on the merits of this particular case.

But after all, the important subject of inquiry is, did Congress, in creating the Court of Claims, intend to confer no it the power to hear and determine cases arising under the revenue laws?

The prompt collection of the revenue, and its faithful application, is one of the most vital duties of government. Depending as the government does on its revenue to meet, not only its current expenses, but to pay the interest on its debt, it is of the utmost importance that it should be collected with despatch, and that the officers of the treasury should be able to make a reliable estimate of means, in order to meet liabilities. It would be difficult to do this, if the receipts from duties and internal taxes paid into the treasury, were liable to be taken out of it, on suits prosecuted in the Court of Claims for alleged errors and mistakes, concerning which the officers charged with the collection and disbursement of the revenue had received no information. Such a policy would be disastrous to the finances of the country, for, as there is no statute of limitations to bar these suits, it would be impossible to tell, in advance, how much money would be required to pay the judgments obtained on them, and the result would be, that the treasury estimates for any current year would be unreliable. To guard against such consequences, Congress has from time to time passed laws on the subject of the revenue, which not only provide for the manner of its collection, but also point out a way in which errors can be corrected. These laws constitute a system, which Congress has provided for the benefit of those persons who complain of illegal assessments of taxes and illegal exactions of duties. In the administration of the tariff laws, as we have seen, the Secretary of the Treasury decides what is due on a specific importation of goods, but if the importer is dissatisfied with this decision, he can contest the question in a suit against the collector, if, before he pays the duties, he tells the officers of the law, in writing, why he objects to their payment.

And an equal provision has been made to correct errors in the administration of the internal revenue laws. The party aggrieved can test the question of the illegality of an assessment, or collection of taxes, by suit; but he cannot do this until he has taken an appeal to the Commissioner of Internal Revenue. If the commissioner delays his decision beyond the period of six months from the time the appeal is taken, then suit may be brought at any time within twelve months from the date of the appeal. Thus it will be seen that the person who believes he has suffered wrong at the hands of the assessor or collector, can appeal to the courts; but he cannot do this until he has taken an intermediate appeal to the commissioner, and at all events, he is barred from bringing a suit, unless he does it within a year from the time the commissioner is notified of his appeal. The object of these different provisions is apparent. While the government is desirous to secure the citizen a mode of redress against erroneous assessments or collections, it says to him, we want all controverted questions concerning the revenue settled speedily, and if you have complaint to make, you must let the Commissioner of Internal Revenue know the grounds of it; but if he decides against you, or fails to decide at all, you can test the question in the courts if you bring your suit within a limited period of time.

These provisions are analogous to those made for the benefit of the importing merchant, and the same results necessarily follow. If the importer does not protest, his right of action is gone. So, if the party complaining of an illegal assessment does not appeal to the commissioner, he is also barred of the right to sue, and he is without remedy, even if he does appeal, unless he sues within twelve months. Can it be supposed that Congress, after having carefully constructed a revenue system, with ample provisions to redress wrong, intended to give to the taxpayer and importer a further and different remedy?

The mischiefs that would result, if the aggrieved party could disregard the provisions in the system designed expressly for his security and benefit, and sue at any time in the Court of Claims, forbid the idea that Congress intended to allow and other modes to redress a supposed wrong in the operation of the revenue laws, than such as are particularly given by those laws.

Without pursuing the subject further, we are satisfied that cases arising under the revenue laws are not within the jurisdiction of the Court of Claims.

JUDGMENT AFFIRMED.


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


text:
Lincoln v. Claflin

ERROR to the Circuit Court of the Northern District of Illinois.

Claflin and others brought an action on the case against two defendants, Lincoln and Mileham, for fraudulently obtaining the property of the plaintiffs, alleging a combination and prearrangement between them, by which Mileham purchased goods to a large amount of different parties in New York, and among others of the plaintiffs, upon false and fraudulent representations of his means and business, and Lincoln sold them at St. Louis, within a few days afterwards, at auction, for less than their cost price, and appropriated the proceeds to his own use; the whole thing being alleged to have been done with intent to defraud the vendors of their property.

That Mileham was guilty of the fraud was not seriously controverted in the court below.

The principal defence turned upon the connection of the defendant Lincoln with the fraudulent acts of Mileham. Lincoln had been, it was alleged, a large creditor of Mileham, and, as he and Mileham asserted, had obtained the goods from Mileham only by his own superior vigilance, and to pay his own just debt. On the subject of the fraudulent connection of the parties, the court charged that the jury must be satisfied either that Lincoln was a party to the original fraud, or that he became a party to it by his own conduct and acts subsequently, with knowledge of the fraud; and that this last, if true, 'would be the same as though he had been a party to it originally.' The court also admitted evidence of other similar fraudulent transactions of the same parties, with others, made about the same time. The court also allowed declarations of each party, made in the absence of the other, relating to the transaction in question, to go to the jury; but it charged that whether these declarations would be evidence as against both, would depend on the view the jury should take in relation to the completion and consummation of the fraudulent enterprise; that is to say, if they believed there was a fraudulent concert between the two defendants, and that these declarations were made during the progress and continuation of the enterprise, what each said would be evidence against the other; but that if the enterprise was ended and completed before the declarations were made, then that what one said would not be evidence against the other. As to damages, it charged that if the jury should find for the plaintiffs, that the amount should be 'the value of the goods at the time they were purchased, with interest from that time.'

The plaintiff excepted to the admission of the evidence above mentioned, and to the charge of the court generally, but did not except to it on the ground of a wrong instruction as to interest. The bill of exceptions set out the whole evidence given on the trial, with a long charge in extenso, and occupied ninety-six pages out of a hundred and twenty-six which composed the record.

The plaintiff recovered judgment, and the defendant, Lincoln, brought the case by a writ of error to this court.

Mr. Goudy, for the plaintiff in error:

1. The allegata and probata do not agree. The gist of the declaration was the purchase of the plaintiff's goods in pursuance of a fraudulent prearrangement between Mileham and Lincoln. Under the allegations the purchase was made as much by Lincoln as Mileham; and Lincoln was an original party to the fraud; not an accessory after the fact, but a principal. Of these allegations there was no proof. There was, therefore, a variance.

The court might have properly charged that the acts of Lincoln subsequent to the purchase were sufficient evidence that he was an original conspirator. But it charged instead that it was unimportant whether he entered into a conspiracy and was a party by preconcert or not; that it was sufficient to convict him, if, knowing of the fraud by Mileham, he became a party to it subsequently. There was no such cause of action set forth, and no such issue.

if such cause of action had been set forth it would not have been a good one. A conspiracy subsequently to the purchase of goods, although fraudulent and injurious, is no cause of action. Adler v. Fenton decides this. Indeed, in that case, there was a conspiracy and fraud for the express purpose of defeating the creditor. Here there was a mere effort of one creditor to gain priority over another; an act which the law commends; for it helps the vigilant, not the sleeping.

2. The admissions were wrongly received. It is true that the court below charged that they would not be evidence as against both of the defendants unless the conspiracy was proved and the common purpose had not been accomplished and completed. But this did not cure the error. There was no evidence of conspiracy, and the reception of the evidence caused a prejudice in the jury against the defendant.

3. That interest is not allowed eo nomine in an action to recover damages for the wrongful conversion or tortious taking of property, but is a matter of discretion with the jury, is settled.

Mr. Farnsworth, contra:

1. Opposing counsel argue the case as if it were in the court below. They contend that Lincoln was a creditor of Mileham, but that question was passed on by the jury, who have obviously found in the negative.

The charge as to Lincoln's connection with the fraud was right. The doctrine laid down in it is held even in criminal cases. Thus, in The People v. Mather, the court say:

'Whenever a new party concurs in the plans originally formed, and comes in to aid in the execution of them, he is from that moment a fellow-conspirator. He commits the offence whenever he agrees to become a party to the transaction, or does any act in furtherance of the original design.'

Adler v. Fenton, relied on to show no cause of action, was an action brought by creditors of Adler & Schiff, upon the complaint that they had fraudulently conspired with their co-defendants to dispose of their property, so as to defeat creditors: the decision was based on the ground that courts would not prevent an insolvent debtor from alienating his property, and that as Adler & Schiff were the legal owners of the property at the time the suit was commenced, no one had any right to interfere with their use. Our case is different. We do not allege that we have suffered damage, by reason of a conspiracy between Lincoln and Mileham, fraudulently to dispose of the property of the latter, but seek to recover damages against them for obtaining, by a fraudulent conspiracy, the possession of our property. The theory of our case is, that no title for the goods he got from us ever passed to Mileham; but that through a prearrangement and conspiracy with Lincoln, they two fraudulently obtained possession of our property, which resulted in damage to us to its value.

2. The admissions were rightly received, even if in an action like the present one a recovery might not be had against any one of the defendants against whom a case was made; which it may be.

Mr. Justice FIELD delivered the opinion of the court.

title: Lincoln v. Claflin


text: Talk:Lincoln v. Claflin

title: Talk:Lincoln v. Claflin