text:
Lincoln v. Claflin/Opinion of the Court

The bill of exceptions in this case is made up without any regard to the rules in accordance with which such bills should be framed. It is little else than a transcript of the evidence, oral and documentary, given at the trial, and covers ninety-six printed pages of the record, when the exceptions could have been presented with greater clearness and precision in any five of them. In its preparation counsel seem to have forgotten that this court does not pass, in actions at law, upon the credibility or sufficiency of testimony; that these are matters which are left to the jury, and for any errors in its action the remedy must be sought in the court below by a motion for a new trial. A bill of exceptions should only present the rulings of the court upon some matter of law-as upon the admission or exclusion of evidence-and should contain only so much of the testimony, or such a statement of the proofs made or offered, as may be necessary to explain the bearing of the rulings upon the issues involved. If the facts upon which the rulings were made are admitted, the bill should state them briefly, as the result of the testimony; if the facts are disputed, it will be sufficient if the bill allege that testimony was produced tending to prove them. If a defect in the proofs is the ground of the exception, such defect should be mentioned without a detail of the testimony. Indeed, it can seldom be necessary for the just determination of any question raised at the trial to set forth the entire evidence given; and the practice in some districts-quite common of late-of sending up to this court bills made up in this way-filled with superfluous and irrelevant matter must be condemned. It only serves to throw increased labor upon us, and unnecessary expense upon parties. If counsel will not heed the admonitions upon this subjuct, so frequently expressed by us, the judges of the courts below, to whom the bills are presented, should withhold their signatures until the bills are prepared in proper form, freed from all matter not essential to explain and point the exceptions.

The action in this case is brought to recover damages against the defendants for fraudulently obtaining the property of the plaintiffs. It differs materially from that of Adler v. Fenton, reported in 24th Howard, which is cited to show that the declaration discloses no cause of action. In that case certain creditors, whose demand was not due at the time, brought an action against their debtors and others for an alleged conspiracy to dispose of the property of the debtors, so as to hinder and defeat the creditors in the collection of their demand; and this court held that the action would not lie. The decision proceeded upon the ground that creditors at large have no such legal interest in the property of their debtors as to enable them to interfere with any disposition of it before the maturity of their demands. The creditors in that case possessed no lien upon or interest in the property of their debtors to impair or clog in any respect the right of the latter to make any use or disposition of it they saw proper. The exercise of that right, whatever the motive, violated no existing right of the creditors, and consequently furnished them no ground of action.

The case at bar is not brought upon the allegation that the defendants have fraudulently disposed of their own property, but that they have fraudulently obtained possession of the property of the plaintiffs. It proceeds upon the theory that the title to the goods never passed to the defendants, but remained in the plaintiffs, from whom they were obtained by false and fraudulent representations.

That such representations were made by the defendant, Mileham, and that by means of them the goods were obtained, was not seriously disputed at the trial. The principal controversy turned upon the connection of the defendant, Lincoln, with the fraudulent acts of Mileham. The declaration alleges that the fraud was a matter of prearrangement between them, and their counsel insisted that proof of such prearrangement was essential to a recovery against Lincoln, but the court held that it was sufficient to show that he subsequently, with knowledge of the fraud, became a party to it; that subsequent participation in the fraud and its fruits was as effective to charge him, as preconcert and combination for its execution. In thus holding we perceive no error. The character of the transaction was not changed, whether Lincoln was an original party in its inception, or became a party subsequently; nor was the damage resulting to the plaintiffs affected by the precise day at which he became a co-conspirator with Mileham. If, knowing the fraud contrived, he aided in its execution, and shared its proceeds, he was chargeable with all its consequences, and could be treated and pursued as an original party. Every act of each in furtherance of the common design was in contemplation of law the act of both.

On the trial declarations of the defendants were received, which related not merely to the transaction which is subject of inquiry in this action, but to similar contemporaneous transactions with other parties. The evidence was not incompetent or irrelevant, as contended by counsel. Where fraud in the purchase or sale of property is in issue, evidence of other frauds of like character committed by the same parties, at or near the same time, is admissible. Its admissibility is placed on the ground that where transactions of a similar character, executed by the same parties, are closely connected in time, the inference is reasonable that they proceed from the same motive. The principle is asserted in Cary v. Hotailing, and is sustained by numerous authorities. The case of fraud, as there stated, is among the few exceptions to the general rule that other offences of the accused are not relevant to establish the main charge.

The declarations of each defendant, relating to the transaction under consideration, were evidence against the other, though made in the latter's absence, if the two were engaged at the time in the furtherance of a common design to defraud the plaintiffs. The court placed their admissibility on that ground, and instructed the jury that if they were made after the consummation of the enterprise they should not be regarded.

It is possible that the court erred in its charge upon the subject of damages in directing the jury to add interest to the value of the goods. Interest is not allowable as a matter of law, except in cases of contract, or the unlawful detention of money. In cases of tort its allowance as damages rests in the discretion of the jury. But the error, if it be one, cannot be taken advantage of by the defendants, for they took no exception to the charge on that ground. The charge is inserted at length in the bill, contrary to the proper practice, as repeatedly stated in our decisions, and contrary to an express rule of this court. It embraces several distinct propositions, and a general exception in such case cannot avail the party if any one of them is correct.

JUDGMENT AFFIRMED.

title: Lincoln v. Claflin/Opinion of the Court


text: Talk:Lincoln v. Claflin/Opinion of the Court

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


text:
Green v. Van Buskirk (74 U.S. 139)

ERROR to the Supreme Court of the State of New York, the case being thus:

The Constitution of the United States declares that 'full faith and credit' shall be given in each State to the judicial proceedings of every other State, and that Congress may prescribe the manner in which such proceedings shall be proved and the effect thereof. Congress, by act of 1790, did accordingly provide that they should 'have such faith and credit given to them in every other court of the United States as they have by law or usage in the court from which they are taken.'

With these provisions in force, one Bates, who lived in Troy, New York, and owned certain iron safes in Chicago, Illinois, in order to secure an existing debt to Van Buskirk and others, executed and delivered (in the State of New York), to them, on the 3d of November, 1857, a chattel mortgage on the safes. Two days after this, one Green, also a creditor of Bates, sued out of the proper court of Illinois a writ of attachment, caused it to be levied on these safes, got judgment in the attachment suit, and had the safes sold in satisfaction of his debt. At the time of the levy of this attachment the mortgage had not been recorded in Illinois; nor had possession of the property been delivered under it; nor had the attaching creditor notice of its existence. Green, Van Buskirk, and Bates were citizens of New York.

It was admitted on the record that the proceedings in attachment were regular and in conformity with the laws of Illinois; that the cases of Martin v. Dryden and Burnell v. Robertson, reported in the Illinois reports, rightly explained those laws; that Bates was the owner of the safes on the 3d of November, 1857, and that Green was a bon a fide creditor of Bates. After the levy of the attachment Green received notice of the mortgage, and the claim under it, and Van Buskirk and the others, mortgagees, were informed of the attachment; but they did not make themselves parties to it and contest the right of Green to levy on the safes, which they were auhorized by the laws of Illinois to do.

By statutes of Illinois, any creditor can sue out a writ of attachment against a non-resident debtor. Under this writ the officer takes possession of the debtor's property. If the debtor cannot be served with process, he receives notice by publication, and if he does not appear, the creditor, on proving his case, has judgment by default, and execution is issued to sell the property attached. These statutes further enact, that mortgages of personal property are void as against third persons, unless acknowledged and recorded, and unless the property be delivered to and remain with the mortgagee.

In this state of the law in Illinois, Van Buskirk sued Green in one of the inferior courts of New York, for taking and converting the safes, sold as already mentioned under the attachment. Green pleaded in bar the attachment proceedings in Illinois. But the court held that the law of New York was to govern the case, not the law of Illinois, though the property was situated there, and that by the law of New York the title to the property passed on the execution and delivery of the mortgage, and took precedence of the subsequent attachment in Illinois. This judgment being affirmed in the highest court of the State of New York, Green, assuming that the 'faith and credit' which the judicial proceedings in courts of Illinois had by law and usage in that State, were denied to them by the decision just mentioned, took a writ of error to this court, conceiving the case of fall within the 25th section of the Judiciary Act, which gives a writ in cases where, in the highest State court, a clause of the Constitution of the United States is drawn in question, and the decision is against the right, title, or privilege specially set up.

The case having got here, a motion was made in December Term, 1866, to dismiss it for want of jurisdiction; the ground of the motion having been, that the only defence set up in the State court was, that the safes at the time of the seizure and sale belonged to Bates, and that by such seizure and sale Green had acquired his title; that thus the only issue tried and determined in the New York court was the right of property and possession at the time of the seizure.

But this court overruled the motion to dismiss, and held, that while the question whether the proceedings in the Illinois court had the effect which Green asserted for them, was one to be decided after argument on the merits, yet that the effect which those proceedings had there by law and usage of that State, was a question necessarily decided by the New York court, and decided against the claim set up by Green under the provision of the Constitution quoted, ante, on page 140; and that so the case was properly in this court for review.

It was now here for such review; a review on merits.

Mr. Porter, with a brief of Mr. Gale, in support of the judgment below:

The defence in the New York courts was, that the safes were Bates's, and were seized and sold as his, under execution in an attachment suit against him. Thus, the leading question was the ownership at the time of the attachment. If the safes were then Bates's, the attachment took effect upon his title; but if they had already passed to his vendees, then the attachment process could not reach them. This leading question of previous ownership, and as to the effect of the sale, as against creditors, necessarily assumed that the Illinois suit and process had their full effect of establishing Green in the legal position of attaching creditor of Bates, and entitled, as such, to contest such sale. Whatever interest Bates had, that, it was admitted, was bound. The question was, whether he had any interest, a matter which did not depend on the record from Illinois, but on the fact whether the assignment was to be governed by the domicile of the owners or by the locus rei sitae. Full faith and credit was thus given to the record.

The New York courts rightly decided that the sale was governed by the law of sales of New York; for a voluntary transfer of personal property is governed everywhere by the law of the owner's domicile, except, perhaps, as against citizens of the local situation. Had the question been tried in Illinois, the courts in that State would, therefore, have determined the effect of Bates's sale by the law of his domicile, and, of course, in the same way that it was determined in New York.

This decision, that the New York law governed the sale, was right, for the further reason that the parties, as citizens of New York, were bound by its laws.

Messrs. A. J. Parker and Lyman Trumbull, contra, contended, that the position of the other side, now taken, was just as good an argument against the jurisdiction of the court in the case, as it was on the question of merits. In effect it was the argument made on the motion to dismiss for want of jurisdiction. But this court had refused to dismiss, and so decided that the argument was unsound. The question now before the court had been really disposed of in the former case. And it was disposed of rightly.

In the State of Illinois, and in all other States where there is what is called an attachment law, an attachment levied under it is 'a proceeding in rem.' Such a proceeding, if there be jurisdiction, is conclusive upon the res against all interested in the property, and the attachment issued holds such interest in the property as the defendant, by the laws of the State, had at that time; though nothing beyond.

If, therefore, the action had been brought by Van Buskirk in the State of Illinois, he could not, on the facts shown, have recovered, but the court then would have said that he had obtained, under the attachment, a good right to the property.

Such being the effect of the judicial proceeding in question in the State of Illinois, we had a right, under the Constitution, and the act of Congress of 1790, to insist that the same force, effect, and credit, should be given to it in the State of New York.

The wisdom of the constitutional and statutory provisions in question making this requirement, and the necessity for strictly enforcing them, are apparent in this case, where it is sought by the defendants in error to convert an act which was lawful in the State of Illinois, where it was done, and in regard to property being there, into a trespass in the State of New York, where they chose to bring these suits.

In conclusion, we refer the court to the case of Guillander v. Howell, decided by the Court of Appeals of the State of New York since the decision of this case. In that case the court seems to abandon the position it held in deciding the present case.

Reply:

In Guillander v. Howell, the attaching creditor was a citizen of the State in which he applied for the benefit of the attachment laws; while here he was a citizen of another State. This is a material point of distinction; for here the parties, as citizens of New York, were bound by its laws.

Mr. Justice DAVIS delivered the opinion of the court.

title: Green v. Van Buskirk (74 U.S. 139)


text: Talk:Green v. Van Buskirk (74 U.S. 139)

title: Talk:Green v. Van Buskirk (74 U.S. 139)


text:
Green v. Van Buskirk (74 U.S. 139)/Opinion of the Court

That the controversy in this case was substantially ended when this court refused to dismiss the writ of error for want of jurisdiction, is quite manifest by the effort which the learned counsel for the defendants in error now make, to escape the force of that decision.

The question raised on the motion to dismiss was, whether the Supreme Court of New York, in this case, had decided against a right which Green claimed under the Constitution, and an act of Congress. If it had, then this court had jurisdiction to entertain the writ of error, otherwise not.

It was insisted on the one said, and denied on the other, that the faith and credit which the judicial proceedings in the courts of the State of Illinois had by law and usage in that State, were denied to them by the Supreme Court of New York, in the decision which was rendered.

Whether this was so or not, could only be properly considered when the case came to be heard on its merits; but this court, in denial of the motion to dismiss, held that the Supreme Court of New York necessarily decided what effect the attachment proceedings in Illinois had by the law and usage in that State; and as it decided against the effect which Green claimed for them, this court had jurisdiction, under the clause of the Constitution which declares 'that full faith and credit shall be given in each State to the public acts, records, and judicial proceedings in every other State,' and the act of Congress of 1790, which gives to those proceedings the same faith and credit in other States, that they have in the State in which they were rendered.

This decision, supported as it was by reason and authority, left for consideration, on the hearing of the case, the inquiry, whether the Supreme Court of New York did give to the attachment proceedings in Illinois, the same effect they would have received in the courts of that State.

By the statutes of Illinois, any creditor can sue out a writ of attachment against a non-resident debtor, under which the officer is required to seize and take possession of the debtor's property, and if the debtor cannot be served with process, he is notified by publication, and if he does not appear, the creditor, on making proper proof, is entitled to a judgment by default for his claim, and a special execution is issued to sell the property attached. The judgment is not a lien upon any other property than that attached; nor can any other be taken in execution to satisfy it. These statutes further provide, that mortgages on personal property have no validity against the rights and interests of third persons, without being acknowledged and recorded, unless the property be delivered to and remain with the mortgagee.

And so strict have the courts of Illinois been in construing the statute concerning chattel mortgages, that they have held, if the mortgage cannot be acknowledged in the manner required by the act, there is no way of making it effective, except to deliver the property, and that even actual notice of the mortgage to the creditor, if it is not properly recorded, will not prevent him from attaching and holding the property.

The policy of the law in Illinois will not permit the owner of personal property to sell it and still continue in possession of it. If between the parties, without delivery, the sale is valid, it has no effect on third persons who, in good faith, get a lien on it; for an attaching creditor stands in the light of a purchaser, and as such will be protected. But it is unnecessary to cite any other judicial decisions of that State but the cases of Martin v. Dryden, and Burnell v. Robertson, which are admitted in the record to be a true exposition of the laws of Illinois on the subject, to establish that there the safes were subject to the process of attachment, and that the proceedings in attachment took precedence of the prior unrecorded mortgage from Bates.

If Green, at the date of the levy of his attachment, did not know of this mortgage, and subsequently perfected his attachment by judgment, execution, and sale, the attachment held the property, although at the date of the levy of the execution he did know of it. The lien he acquired, as a bon a fide creditor, when he levied his attachment without notice of the mortgage, he had the right to perfect and secure to himself, notwithstanding the fact that the mortgage existed, was known to him, before the judicial proceedings were completed. This doctrine has received the sanction of the highest court in Illinois through a long series of decisions, and may well be considered the settled policy of the State on the subject of the transfer of personal property. If so, the effect which the courts there would give to these proceedings in attachment, is too plain for controversy. It is clear, if Van Buskirk had selected Illinois, instead of New York, to test the liability of these safes to seizure and condemnation, on the same evidence and pleadings, their seizure and condemnation would have been justified.

It is true, the court in Illinois did not undertake to settle in the attachment suit the title to the property, for that question was not involved in it, but when the true state of the property was shown by other evidence, as was done in this suit, then it was obvious that by the laws of Illinois it could be seized in attachment as Bates's property.

In order to give due force and effect to a judicial proceeding, it is often necessary to show by evidence, outside of the record, the predicament of the property on which it operated. This was done in this case, and determined the effect the attachment proceedings in Illinois produced on the safes, which effect was denied to them by the Supreme Court of New York.

At an early day in the history of this court, the act of Congress of 1790, which was passed in execution of an express power conferred by the Constitution, received an interpretation which has never been departed from, and obtained its latest exposition in the case of Christmas v. Russell.

The act declares that the record of a judgment (authenticated in a particular manner), shall have the same faith and credit as it has in the State court from whence it is taken. And this court say: 'Congress have therefore declared the effect of the record, by declaring what faith and credit shall be given to it;' and that 'it is only necessary to inquire in every case what is the effect of a judgment in the State where it is rendered.'

It should be borne in mind in the discussion of this case, that the record in the attachment suit was not used as the foundation of an action, but for purposes of defence. Of course Green could not sue Bates on it, because the court had no jurisdiction of his person; nor could it operate on any other property belonging to Bates than that which was attached. But, as by the law of Illinois, Bates was the owner of the iron safes when the writ of attachment was levied, and as Green could and did lawfully attach them to satisfy his debt in a court which had jurisdiction to render the judgment, and as the safes were lawfully sold to satisfy that judgment, it follows that when thus sold the right of property in them was changed, and the title to them became vested in the purchasers at the sale. And as the effect of the levy, judgment and sale is to protect Green if sued in the courts of Illinois, and these proceedings are produced for his own justification, it ought to require no argument to show that when sued in the court of another State for the same transaction, and he justifies in the same manner, that he is also protected. Any other rule would destroy all safety in derivative titles, and deny to a State the power to regulate the transfer of personal property within its limits and to subject such property to legal proceedings.

Attachment laws, to use the words of Chancellor Kent, 'are legal modes of acquiring title to property by operation of law.' They exist in every State for the furtherance of justice, with more or less of liberality to creditors. And if the title acquired under the attachment laws of a State, and which is valid there, is not to be held valid in every other State, it were better that those laws were abolished, for they would prove to be but a snare and a delusion to the creditor.

The Vice-Chancellor of New York, in Cochran v. Fitch, when discussing the effect of certain attachment proceedings in the State of Connecticut, says: 'As there was no fraud shown, and the court in Connecticut had undoubted jurisdiction in rem against the complainant, it follows that I am bound in this State to give to the proceedings of that court the same faith and credit they would have in Connecticut.' As some of the judges of New York had spoken of these proceedings in another State, without service of process or appearance, as being nullities in that State and void, the same vice-chancellor says: 'But these expressions are all to be referred to the cases then under consideration, and it will be found that all those were suits brought upon the foreign judgment as a debt, to enforce it against the person of the debtor, in which it was attempted to set up the judgment as one binding on the person.'

The distinction between the effect of proceedings by foreign attachments, when offered in evidence as the ground of recovery against the person of the debtor, and their effect when used in defence to justify the conduct of the attaching creditor, is manifest and supported by authority. Chief Justice Parker, in Hall v. Williams, speaking of the force and effect of judgments recovered in other States, says: 'Such a judgment is to conclude as to everything over which the court which rendered it had jurisdiction. If the property of the citizen of another State, within its lawful jurisdiction, is condemned by lawful process there, the decree is final and conclusive.'

It would seem to be unnecessary to continue this investigation further, but our great respect for the learned court that pronounced the judgment in this case, induces us to notice the ground on which they rested their decision. It is, that the law of the State of New York is to govern this transaction, and not the law of the State of Illinois where the property was situated; and as, by the law of New York, Bates had no property in the safes at the date of the levy of the writ of attachment, therefore none could be acquired by the attachment. The theory of the case is, that the voluntary transfer of personal property is to be governed everywhere by the law of the owner's domicile, and this theory proceeds on the fiction of law that the domicile of the owner draws to it the personal estate which he owns wherever it may happen to be located. But this fiction is by no means of universal application, and as Judge Story says, 'yields whenever it is necessary for the purposes of justice that the actual situs of the thing should be examined.' It has yielded in New York on the power of the State to tax the personal property of one of her citizens, situated in a sister State, and always yields to 'laws for attaching the estate of non-residents, because such laws necessarily assume that property has a situs entirely distinct from the owner's domicile.' If New York cannot compel the personal property of Bates (one of her citizens) in Chicago to contribute to the expenses of her government, and if Bates had the legal right to own such property there, and was protected in its ownership by the laws of the State; and as the power to protect implies the right to regulate, it would seem to follow that the dominion of Illinois over the property was complete, and her right perfect to regulate its transfer and subject it to process and execution in her own way and by her own laws.

We do not propose to discuss the question how far the transfer of personal property lawful in the owner's domicile will be respected in the courts of the country where the property is located and a different rule of transfer prevails. It is a vexed question, on which learned courts have differed; but after all there is no absolute right to have such transfer respected, and it is only on a principle of comity that it is ever allowed. And this principle of comity always yields when the laws and policy of the State where the property is located has prescribed a different rule of transfer with that of the State where the owner lives.

We have been referred to the case of Guillander v. Howell, recently decided by the Court of Appeals of New York, and as we understand the decision in that case, it harmonizes with the views presented in this opinion. A citizen of New York owning personal property in New Jersey made an assignment, with preferences to creditors, which was valid in New York but void in New Jersey. Certain creditors in New Jersey seized the property there under her foreign attachment laws and sold it, and the Court of Appeals recognized the validity of the attachment proceeding, and disregarded the sale in New York. That case and the one at bar are alike in all respects except that the attaching creditor there was a citizen of the State in which he applied for the benefit of the attachment laws, while Green, the plaintiff in error, was a citizen of New York; and it is insisted that this point of difference is a material element to be considered by the court in determining this controversy, for the reason that the parties to this suit, as citizens of New York, were bound by its laws. But the right under the Constitution of the United States and the law of Congress which Green invoked to his aid is not at all afffected by the question of citizenship. We cannot see why, if Illinois, in the spirit of enlightened legislation, concedes to the citizens of other States equal privileges with her own in her foreign attachment laws, that the judgment against the personal estate located in her limits of a non-resident debtor, which a citizen of New York lawfully obtained there, should have a different effect given to it under the provisions of the Constitution and the law of Congress, because the debtor, against whose property it was recovered, happened also to be a citizen of New York.

The judgment of the Supreme Court of the State of New York is REVERSED, and the cause remitted to that court with instructions to enter

JUDGMENT FOR THE PLAINTIFF IN ERROR.


text: Talk:Green v. Van Buskirk (74 U.S. 139)/Opinion of the Court


text:
The Siren

APPEAL from the District Court for Massachusetts.

The steamer Siren was captured in the harbor of Charleston in attempting to violate the blockade of that port, in February, 1865, by the steamer Gladiolus, belonging to the navy of the United States. She was placed in charge of a prize master and crew, and ordered to the port of Boston for adjudication. On her way she was obliged to put into the port of New York for coal, and, in proceeding thence through the narrow passage which leads to Long Island Sound, known as Hurlgate, she ran into and sank the sloop Harper, loaded with iron, and bound from New York to Providence, Rhode Island. The collision was regarded by this court, on the evidence, as the fault of the Siren.

On the arrival of the steamer at Boston, a libel in prize was filed against her, and no claim having been presented, she was, in April following, condemned as lawful prize, and sold. The proceeds of the sale were deposited with the assistant treasurer of the United States, in compliance with the act of Congress, where they now remain, subject to the order of the court.

In these proceedings the owners of the sloop Harper, and the owners of her cargo, intervened by petition, asserting a claim upon the vessel and her proceeds, for the damages sustained by the collision, and praying that their claim might be allowed and paid out of the proceeds.

The District Court held that the intervention could not be allowed, and dismissed the petitions; and hence the present appeals.

Mr. Ashton, Assistant Attorney-General Of the United States, argued the case fully, upon principles and authority, maintaining the correctness of the decree below upon several specific grounds, resolvable into these two general ones:

1st. That to allow the intervention would be, in substance, to allow the citizen to implead the government, which, he asserted, was universally repugnant to settled principles; and,

2d. That the question as to a claim upon a prize ship, created after capture, was not within the jurisdiction of a prize court, which, he contended, can deal only with the question of prize or no prize.

Mr. Causten Browne, contra.

Mr. Justice FIELD delivered the opinion of the court.

title: The Siren


text: Talk:The Siren

title: Talk:The Siren


text:
The Siren/Opinion of the Court

It is a familiar doctrine of the common law, that the sovereign cannot be sued in his own courts without his consent. The doctrine rests upon reasons of public policy; the inconvenience and danger which would follow from any different rule. It is obvious that the public service would be hindered, and the public safety endangered, if the supreme authority could be subjected to suit at the instance of every citizen, and consequently controlled in the use and disposition of the means required for the proper administration of the government. The exemption from direct suit is, therefore, without exception. This doctrine of the common law is equally applicable to the supreme authority of the nation, the United States. They cannot be subjected to legal proceedings at law or in equity without their consent; and whoever institutes such proceedings must bring his case within the authority of some act of Congress. Such is the language of this court in United States v. Clarke.

The same exemption from judicial process extends to the property of the United States, and for the same reasons. As justly observed by the learned judge who tried this case, there is no distinction between suits against the government directly, and suits against its property.

But although direct suits cannot be maintained against the United States, or against their property, yet, when the United States institute a suit, they waive their exemption so far as to allow a presentation by the defendant of set-offs, legal and equitable, to the extent of the demand made or property claimed, and when they proceed in rem, they open to consideration all claims and equities in regard to the property libelled. They then stand in such proceedings, with reference to the rights of defendants or claimants, precisely as private suitors, except that they are exempt from costs and from affirmative relief against them, beyond the demand or property in controversy. In United States v. Ringgold, a claim of the defendant was allowed as a set-off to the demand of the government. 'No direct suit,' said the court, 'can be maintained against the United States. But when an action is brought by the United States to recover moneys in the hands of a party who has a legal claim against them, it would be a very rigid principle to deny to him the right of setting up such claim in a court of justice, and turn him round to an application to Congress.' So in United States v. Macdaniel, to which reference is made in the case cited, the defendant was allowed to set off against the demand of the government a claim for services as agent for the payment of the navy pension fund, to which the court held he was equitably entitled. The question, said the court, was, whether the defendant should surrender the money which happened to be in his hands, and then petition Congress on the subject; and it was held that the government had no right, legal or equitable, to the money.

For the damages occasioned by collision of vessels at sea a claim is created against the vessel in fault, in favor of the injured party. This claim may be enforced in the admiralty by a proceeding in rem, except where the vessel is the property of the United States. In such case the claim exists equally as if the vessel belonged to a private citizen, but for reasons of public policy, already stated, cannot be enforced by direct proceedings against the vessel. It stands, in that respect, like a claim against the government, incapable of enforcement without its consent, and unavailable for any purpose.

In England, when the damage is inflicted by a vessel belonging to the crown, it was formerly held that the remedy must be sought against the officer in command of the offending ship. But the present practice is to file a libel in rem, upon which the court directs the registrar to write to the lords of the admiralty requesting an appearance on behalf of the crown-which is generally given-when the subsequent proceedings to decree are conducted as in other cases. In the case of The Athol, the court refused to issue a monition to the lords of the admiralty to appear in a suit for damage by collision, occasioned to a vessel by a ship of the crown; but the lords having subsequently directed an appearance to be entered, the court proceeded with the case, and awarded damages. As no warrant issues in these cases for the arrest of the vessels of the crown, and no bail is given on the appearance, it is insisted that they are brought simply to ascertain the extent of the damages, and that the decrees are little more than awards, so far as the government is concerned. This may be the only result of the suits, but they are instituted and conducted on the hypothesis that claims against the offending vessels are created by the collision. The vessels are not arrested and taken into custody by the marshal, for the reasons of public policy already stated, and for the further reason that it is to be presumed that the government will at once satisfy a decree rendered by its own tribunals in a case in which it has voluntarily appeared.

It is true, that in case of damage committed by a public vessel a legal responsibility attaches to the actual wrongdoer, the commanding officer of the offending ship, and the injured party may seek redress against him; but this is not inconsistent with the existence of a claim against the vessel itself. In the case of The Athol, already referred to, where the liability of the actual wrongdoer is asserted, damages against the vessel were pronounced after an appearance on behalf of the crown had been given by the admiralty proctor.

The inability to enforce the claim against the vessel is not inconsistent with its existence.

Seamen's wages constitute preferred claims, under the maritime law, upon all vessels; yet they cannot be enforced against a vessel of the nation, or a vessel employed in its service. In a case before the Admiralty Court of Pennsylvania, in 1781, it was adjudged, on a plea to the jurisdiction, that mariners enlisting on board a ship of war belonging to a sovereign independent State could not libel the ship for their wages.

In a case in the English Admiralty Court, a libel having been filed to enforce a claim for seamen's wages against a packet ship employed in the service of the General Post Office, Sir William Scott declined to take jurisdiction until notice was given to the Post Office Department, and he was informed that no objection was taken to the proceeding. The fact that the court took jurisdiction when the exemption, upon which the government could insist, was waived, shows that a claim against the vessel existed, as only upon its existence could the libel in any event be sustained.

Even where claims are made liens upon property by statute, they cannot be enforced by direct suit, if the property subsequently vest in the government. Thus in Massachusetts the statutes provide, that any person to whom money is due for labor and materials furnished in the construction of a vessel in that commonwealth, shall have a lien upon her, which shall be preferred to all other liens except mariners' wages, and shall continue until the debt is paid, unless lost by a failure to comply with certain specified conditions; yet in a recent case, where a vessel subject to a lien of this character was transferred to the United States, it was held that the lien could not be enforced in the courts of that State. The decision was placed upon the general exemption of the government and its property from legal process.

So also express contract liens upon the property of the United States are incapable of enforcement. A mortgage upon property, the title to which had subsequently passed to the United States, would be in the same position as a claim against a vessel of the government, incapable of enforcement by legal proceedings. The United States, possessing the fee, would be an indispensable party to any suit to foreclose the equity of redemption, or to obtain a sale of the premises. In Lutwich v. The Attorney-General, a case cited by Lord Hardwicke in deciding Reeve v. Attorney-General, a bill was filed to foreclose a mortgage after the mortgagor had been attainted for high treason, and the court refused a foreclosure against the crown, but directed that the mortgagee should hold and enjoy the mortgaged premises until the crown thought proper to redeem the estate.

In Hodge v. Attorney-General, the deeds of certain leasehold estates had been deposited by one Bailey with the plaintiffs, who were bankers, to secure a balance of a running account between him and them. Bailey was afterwards convicted of felony, and the leasehold estates vested in the crown. At the time of his conviction he was indebted to the plaintiffs, who filed a bill against the attorney-general, claiming to be equitable mortgagees of the leasehold estates, to subject the property to sale, and the application of the proceeds to the payment of the amount due them. But the court said that the only decree which could be made in the case was to declare the plaintiffs to be equitable mortgagees of the property, to direct an account to be taken, and that the plaintiffs hold possession of the property until their lien was satisfied. 'I do not think,' said Baron Alderson, in giving the decision, 'that I have any jurisdiction in this case to order a sale. Here the legal estate is vested in the crown; and I do not know any process by which this court can compel the crown to convey that legal estate.'

In this country, where, as a general rule, a mortgage is treated only as a lien or incumbrance, and the mortgagor retains possession of the premises, the relief granted in the two cases cited would be of no avail.

The authorities to which we have referred are sufficient to show that the existence of a claim, and even of a lien upon property, is not always dependent upon the ability of the holder to enforce it by legal proceedings. A claim or lien existing and continuing will be enforced by the courts whenever the property upon which it lies becomes subject to their jurisdiction and control. Then the rights and interests of all parties will be respected and maintained. Thus, if the government, having the title to land subject to the mortgage of the previous owner, should transfer the property, the jurisdiction of the court to enforce the lien would at once attach, as it existed before the acquisition of the property by the government.

So if property belonging to the government, upon which claims exist, is sold upon judicial decree, and the proceeds are paid into the registry, the court would have jurisdiction to direct the claims to be satisfied out of them. Such decree of sale could only be made upon application of the government, and by its appearance in court, as we have already said, it waives its exemption and submits to the application of the same principles by which justice is administered between private suitors.

Now, it is a settled principle of admiralty law, that all maritime claims upon the vessel extend equally to the proceeds arising from its sale, and are to be satisfied out of them. Assuming, therefore, that the Siren was in fault, and that by the tort she committed a claim was created against her, we do not perceive any just ground for refusing its satisfaction out of the proceeds of her sale. The government is the actor in the suit for her condemnation. It asks for her sale, and the proceeds coming into the registry of the court, come affected with all the claims which existed upon the vessel created subsequent to her capture. There is no authority, that we are aware of, which would exempt them under these circumstances, because of the exemption of the government from a direct proceeding in rem against the vessel whilst in its custody.

This doctrine was applied by this court in the case of the St. Jago de Cuba, where a libel was filed by the United States to forfeit the vessel for violation of the laws prohibiting the slave trade. Claims of seamen for wages, and of material-men for supplies, when the parties were ignorant of the illegal voyage of the vessel, were allowed and paid out of the proceeds. These claims arose subsequent to the illegal acts which created the forfeiture, yet they were not superseded by the claim of the government. 'In case of wreck and salvage,' said the court, 'it is unquestionable that the forfeiture would be superseded; and we see no ground on which to preclude any other maritime claim fairly and honestly acquired.' This language, though used with reference to claims arising out of contract, may be applied to claims arising out of torts committed after the capture of the offending vessel.

In United States v. Wilder it was held that goods of the United States were subject to contribution equally with goods of private shippers, to meet the expenses incurred in saving them, which were averaged, and that the owners of the vessel could retain the goods, until their share of the contribution to the average was paid or secured. The United States claimed the right to take the goods without paying or securing this share; and this being denied, the action was brought to recover their value. In delivering the opinion, Mr. Justice Story stated that he was unable to distinguish the case from one of salvage, and that it had never been doubted that in cases of salvage of private ships and cargoes, the freight on board belonging to the government was equally subject to the admiralty process in rem for its proportion due for salvage with that of mere private shippers; but that it might be, for aught he knew, different in cases of the salvage of public ships. 'The same reasoning, however,' continued the learned justice, 'which has been applied by the government against the lien for general average, applies with equal force against the lien for salvage of government property under all circumstances. Besides, it is by no means true, that liens existing on particular things are displaced by the government becoming, or succeeding to the proprietary interest. The lien of seamen's wages and of bottomry bonds exists in all cases as much against the government, becoming proprietors by way of purchase, or forfeiture, or otherwise, as it does against the particular things in the possession of a private person.' In the case of The Schooner Davis and Cargo, recently decided in the Circuit Court of the United States for the Southern District of New York, cotton belonging to the United States was held liable to contribution to meet the allowance made for salvage services in saving vessel and cargo. 'The mere fact,' said the court, 'of the ownership of the cotton by the government, in the act of being carried to its port of destination for the purposes of a market as merchandise, we think did not exempt it from the lien in case of salvage service. We shall not enter into an argument in support of the position, as the subject, or rather a kindred one-the liability of property of the government for general average-and the present question incidentally have been already most elaborately examined by Mr. Justice Story. We are inclined, also, to the opinion, that it is the doctrine of the admiralty in England, and of the most approved modern elementary writers on the subject in this country.'

There is no just foundation for the objection that claims for maritime torts cannot be dealt with and adjusted by a prize court. 'It is a principle well settled, and constantly conceded and applied,' said Chancellor Kent, 'that prize courts have exclusive jurisdiction and an enlarged discretion as to the allowance of freight, damages, expenses, and costs in all cases of captures, and as to all torts, and personal injuries, and ill-treatments, and abuse of power connected with captures jure belli; and the courts will frequently award large and liberal damages in those cases.' The jurisdiction is not, therefore, limited to the determination of the simple question of prize or no prize. But whatever may be the limitation upon the jurisdiction of a prize court in England, there is no such limitation upon the District Court sitting as a prize court in this country. Here, the District Court, as was said in United States v. Weed, 'holds both its prize jurisdiction and its jurisdiction as an instance court of admiralty from the Constitution and the acts of Congress, and is but one court with these different branches of admiralty jurisdiction, as well as cognizance of other and distinct subjects.' It may, therefore, hear and determine all questions respecting claims arising after the capture of the vessel. Outstanding claims upon the vessel, existing previous to the capture, cannot be considered. This exclusion rests not on the ground of any supposed inability of the court to pass upon these claims correctly, but because they are superseded by the capture.

As to the suggestion that a maritime tort, committed by a ship in possession of a prize master and crew, ought not to create a claim on the vessel against a neutral owner in case the vessel is restored, it is sufficient to say, although the vessel having been condemned the question is not of importance in this case, that the claim in that event, if held to exist, would not be the subject of consideration by the prize court. Here, however, the title was divested from the previous owner by the capture, that being lawful, and vested in the United States (in trust as to one-half for the captors), although the legality of the capture was not established until the sentence of condemnation.

It does not appear that the court below considered the evidence as to the character and extent of the alleged tort. It appears to have placed its decision entirely upon the legal proposition, that the captured vessel was exempt from legal process at the suit of the intervenors, and that consequently the proceeds of the vessel could not be subjected to the satisfaction of their claims. We have, however, looked into the evidence, and are satisfied that the collision was the fault of the Siren. It took place in the daytime. The sloop was seen from the steamer in time to avoid her. The steamer was out of the regular track for steamers passing through Hurlgate. The passage is noted for its difficulties and dangers, and, under the laws of New York, pilots are specially commissioned to take vessels through it. The prize master engaged a pilot for the Sound to take the steamer from New York to Boston, but refused to engage a Hurlgate pilot, his reason being to avoid expense. With such a pilot she would have been taken in the regular track of steamers northward of Blackwell's Island, and so close to Flood Rock as to aboid the sloop, as might easily have been done. We do not think it important to cite from the evidence in vindication of our conclusion, especially as it was not seriously contested on the argument that the Siren was responsible for the collision.

The decree must be REVERSED, and the cause remanded to the court below, with directions to assess the damages and pay them out of the proceeds of the vessel before distribution to the captors.

ORDERED ACCORDINGLY.

title: The Siren/Opinion of the Court


text: Talk:The Siren/Opinion of the Court

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Page:The Confidence Man.djvu/228

214, lutton, and coquette, though, doubtless; being such, they may have their little foibles—as who has not?—yet not one of the three can be reproached with that awful sin of shunning society; awful I call it, for not seldom it presupposes a still darker thing than itself—remorse."

"Remorse drives man away from man? How came your fellow-creature, Cain, after the first murder, to go and build the first city? And why is it that the modern Cain dreads nothing so much as solitary confinement?

"My dear fellow, you get excited. Say what you will, I for one must have my fellow-creatures round me. Thick, too—I must have them thick."

"The pick-pocket, too, loves to have his fellow-creatures round him. Tut, man! no one goes into the crowd but for his end; and the end of too many is the same as the pick-pocket's—a purse."

"Now, my dear fellow, how can you have the conscience to say that, when it is as much according to natural law that men are social as sheep gregarious. But grant that, in being social, each man has his end, do you, upon the strength of that, do you yourself, I say, mix with man, now, immediately, and be your end a more genial philosophy. Come, let's take a turn."

Again he offered his fraternal arm; but the bachelor once more flung it off, and, raising his rifle in energetic invocation, cried: "Now the high-constable catch and confound all knaves in towns and rats in grain-bins, and

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Dorsheimer v. United States

APPEAL from the Court of Claims.

Dorsheimer, collector of internal revenue at Buffalo, New York, and two others, informers in the case, filed a petition in the Court of Claims to recover from the United States one-half of $220,102, which the government received on a compromise with Sturges & Sons, of a prosecution against property of one Rhomberg, a distiller.

The case was this:

The act of June 3, 1864, 'to provide internal revenue,' enacts, that any distiller who shall fail to make true entry and report of his stills, liquors, &c., shall forfeit all the liquors made, and all the vessels, stills, &c., and personal property on the premises, &c.; and that these may be seized by any collector, and held by him until a decision thereon according to law. And by its 179th section gives authority to collectors to prosecute for the recovery of fines, penalties, and forfeitures, in the name of the United States; and confers the right to one moiety of them upon 'the collector or deputy collector' who shall first 'inform of the cause, matter, or thing, whereby such penalty may have been incurred.'

The amendment to this section in the act of March 3, 1865, gives this to any person who shall first inform, and adds, that when 'the penalty is paid without suit, or before judgment, and a moiety is claimed by any person as informer, the Secretary of the Treasury shall determine whether any claimant is entitled to such moiety, and to whom it shall be piad.' An early act-one of March 3, 1797 -confers authority on the Secretary of the Treasury to mitigate or remit any fine, forfeiture, or penalty, incurred by any vessel, goods, or wares, by force of the laws for laying, levying, or collecting any duties or taxes, which, in his opinion, shall have been incurred without wilful negligence, or any intention of fraud in the person or persons incurring the same.

With these acts in force, Rhomberg, a distiller at Dubuque, Iowa, violated the laws by making false returns, and fraudulently withholding taxes to the amount of $195,000. Upon information furnished by Dorsheimer and the two other persons, his liquors, distilling apparatus, grain, and the cattle at the distillery, were seized, and proceedings for their forfeiture instituted in the several districts of New York, Illinois, and Iowa, where the seizures were made.

After the seizure, Sturges & Sons, of Chicago, intervened, asserting that, without the least knowledge of Rhomberg's fraud, they had made very large advances on the property seized. And they paid to the United States $33,946, on confession, by Rhomberg, that that amount of taxes had been withheld by him.

The government, however, still holding on to the property seized, and the suits being in existence, Sturges & Sons entered into negotiations with the Commissioner of the Internal Revenue, who accordingly released the spirits seized, and dismissed the proceedings, excepting in Iowa, taking, in place of them, the bond of Sturges & Sons for $275,000, conditioned,

That, if it should be determined by the commissioner that the said spirits are not subject to the lien of the government for revenue duties, as against the advances made by the said firm, or if the obligors shall pay such sum of money as the commissioner should determine to be due the government for said property seized, then the obligation to be void; it being understood that the obligors are not liable, under the bond, for any penalty which the government may assess against Rhomberg, but only shall be liable for the actual amount of duties found to be unpaid, together with proper costs and charges attending the investigation of the case and seizure of the property.

In the meanwhile the United States continued its prosecution against the distillery, and to prevent the loss which would occur by stopping it, the officers in charge proceeded to use up the raw materials on hand which had been seized, and, in so doing, produced liquors valued at $150,000; the money (about $54,814) required to pay the expenses of so running the distillery, being furnished by Sturges & Sons.

After various negotiations-Rhomberg's fraud standing confessed on the records of the Treasury-the Secretary of the Treasury compromised with Sturges & Sons, thus:

He relinquished to them the distillery and the appurtenances, and also the product of the distillery, namely, the $150,000 worth of liquor, free of tax, and also the moneys received at Dubuque, $54,814; also, the proceeds of the cattle which had been sold, and the liquors seized, with the claim of the United States for forfeiture. The government also surrendered the bond for $275,000, given by Sturges & Sons, and assigned to them a bond given by Rhomberg to the United States. The government, on its part, received $220,102, 'which amount the Secretary of the Treasury stated to be composed as follows:'

Deficiency of taxes,............. $195,102

In lieu of penalties and forfeitures,. 25,000

$220,102

This compromise was made in face of a protest of Dorsheimer and his co-informers, against any settlement which should make a distinction between the share to be paid to the government and the share to be paid to them. The secretary professed to make it under the 44th section of the act of 30th June, 1864, which gives him power to compromise all suits 'relating to the internal revenue.'

The compromise being made, Dorsheimer and his co-informers claimed from the secretary one-half of the $220,102 received. The secretary refused to pay them the half of that sum, but was willing to pay them half of the $25,000, this last sum being, as he considered, all that was received in lieu of penalties and forfeiture. Dorsheimer and his co-informers accordingly filed their petition in the Court of Claims, setting forth the facts of the case as above, and claiming the half of the $220,102. The United States demurred, and the demurrer-after argument, in which The United States v. Morris, reported in 10th Wheaton, 246, was relied on to support it,-being sustained, and the petition dismissed, the case was brought here by the informers on appeal.

Messrs. Dorsheimer and Dick (with whom was Mr. M. Blair), for the appellants:

Invited by statutes relating to the internal revenue, the petitioners below undertook the services mentioned in this case. They thus became employed by the government, and rights accrued to them for their services. When suit was instituted, it was instituted upon a forfeiture given by law; a forfeiture as from the date of the offence committed; and this forfeiture was a 'statutory transfer of right.' The right was to the joint use of the government and the informers, and so continued until the final settlement was made. The interest of an informer is a matter of contract, and a right of property, though, until decree, but an inchoate right, vests; a right which the government cannot affect. No doubt the secretary may remit, in virtue of pre-existing statutes; but this power, says this court in The Gray Jacket, 'is defined and limited by law.' The jurisdiction is a special one, and, if transcended, the secretary's act is void.

The compromise could not be sustained at all on the act of 1797, which gives authority to remit or mitigate only on the ground of innocence. Here the guilt was confessed. And the secretary here made no voluntary or gratuitous surrender of any of the joint rights and claims. On the contrary, he made the most out of them that could be made.

Neither can the secretary, under the power given in the act of 1864 to 'compromise,' so compromise as to destroy the rights of the informers, in the way which he would here seek to do. The secretary stood in the place of the parties interested in the suit, parties who had a joint interest. He had no power, under any proceeding, however named, to divide the interest of the government from that of the officers; nor to settle the controversy upon terms which would make the result of what he did enure to the advantage of one and not of the other. His power extended no further than to agree with the opposing claimant, on the division between him, such claimant, and the parties represented by the secretary, of the property seized, and what the opposing claimant relinquished belonged to the parties to the suit; belonging to them not de novo, but by means of the previously existing title. A compromise is a common end of a suit, well known to the law, and yields fruits which are as thoroughly the avails of the suit as would be those given by a writ of execution. And, indeed, as this mode of terminating these suits is prescribed by the act under consideration, it may be well considered as in the category of process of law for the enforcement of claims under the statute.

The United States v. Morris decides nothing more than that the anthority to remit the forfeiture is not limited to the period before condemnation or judgment, but that 'the authority to remit is limited only by the payment of the money to the collector for distribution.' So the court says: 'If the government refuse to adopt the informer's acts, or waive the forfeiture, there is an end to his claim; he cannot proceed to enforce that which the government repudiates.' Whence it is inferable that if the government did adopt his acts, and did not waive the forfeiture, but, on the contrary, reaped a great benefit from them, that then the informer would be entitled to recover his share of that which the government received by and through the adoption of his acts, and the proceedings upon his information.

In the case now at bar, there was an action instituted by the government upon and as the direct consequence of the collector's proceedings. The only question is whether the money received was the fruit of the action. Clearly it was; for through the proceedings of the collector the government received a large sum; without them it would have received nothing.

The taxes, so called, were not paid by or on behalf of Rhomberg, and no one else was liable for them. No receipt for taxes was given to any one, nor were Rhomberg's interests considered at all in the settlement. The purchasers of the property from him were negotiating with the United States for a confirmation of their title, and asked for and got a sale, transfer, and delivery of the property, clothed with the title which the government had acquired. Sturges & Sons considered the case theirs. Rhomberg was out of the question. The forfeitures by his frauds, standing confessed, had extinguished him.

There is no doubt but that the claimants would have been entitled to the moiety of this sum of $195,102, if the secretary had not called it by the name of taxes. The compromise was simply that the owners paid $220,102, and received back their property, worth $350,000, with a discontinuance of the suit. But the secretary determines within his own mind-in petto-that this sum of $220,102 shall be composed of certain elements; a composition wholly imaginary; and that the compromise should consist in his receiving a sum equal to the taxes on a part of the property, and another sum, fixed arbitrarily, which he called the forfeiture. If, after the money had been paid, he had reconsidered his determination, and called the $195,102 forfeiture instead of taxes, the claimants would have been entitled to one-half of this, and the defendant in the other suit would have been neither injured nor affected; and if, on the contrary, he had reconsidered his determination, and called the $25,000 taxes on some other portion of the property relinquished, the claimants would have been entitled to nothing, and the defendant in the other suit would have been neither benefited nor affected. Now, has the secretary, under a power to 'compromise a suit,' not only a power to compromise the suit, but an absolute right of distribution over the proceeds? We conceive that the government had a controlling right to abandon the adventure, but we submit that it had no right to remit its partner's share and retain its own.

In conclusion: The claims of the informers are maintained by the general policy of the United States; which is, that whenever the government adopts the acts of the informer, and proceeds upon his discoveries and to his risk, it will share equally with him whatever may be received through his proceedings; a policy which has never been departed from since the establishment of the government, has been clearly indicated by its statutes, and repeatedly maintained by this court.

Mr. Talbot, contra:

The only question is, whether the $195,102 was penalty.

The Secretary of the Treasury states that it was not received as penalty. And beyond the statement of this officer, this court will make no inquiry. That statement will be deemed sufficient to sustain the demurrer.

But if the court look into the admitted case, it corroborates this representation of the secretary.

There was a confessed deficiency of $195,000 taxes, and $33,946 was paid soon after the seizure, upon a confession of so much deficiency of taxes. The bond given by Sturges & Sons was to secure payment of unpaid taxes.

To these statements of fact it is no answer to say even that the action of the secretary was not authorized by law. Whether brought about lawfully or otherwise, the result, namely, the non-payment of the sum of $195,102, or of any part thereof, as penalty, takes away the foundation of this claim. For this is a claim not for damages, because the Secretary of the Treasury has unlawfully prevented a moiety from accruing to the appellants, but for a moiety which they allege did accrue. Nor does it avail the appellants that what was received ought to have been received as penalty. It is enough in support of the demurrer to show that, in fact, it was not paid and received as penalty.

Further. The act of the secretary in discontinuing these proceedings upon full payment of the taxes withheld, and of $25,000 in lieu of fines and penalties, was within the scope of authority conferred by the 44th section of the act of 1864, to compromise all 'suits relating to internal revenue.'

Mr. Justice GRIER delivered the opinion of the court, and having quoted the act of March 3d, 1797, and the 179th section of that of June 3d, 1864, as amended in the act of March 3d, 1865, all as already given in the statement of the case, proceeded as follows:

The purpose of penalties inflicted upon persons who attempt to defraud the revenue, is to enforce the collection of duties and taxes. They act in terrorem upon parties whose conscientious scruples are not sufficient to balance their hopes of profit. The offer of a portion of such penalties to the collectors is to stimulate and reward their zeal and industry in detecting fraudulent attempts to evade the payment of duties and taxes.

As the great object of the act 'to provide internal revenue' is to collect the tax, the Secretary of the Treasury has no power to remit it. When the primary object of collecting the tax is obtained, as in the present case, the further infliction of penalties is submitted entirely to the discretion of the secretary. No discretion is given to the courts to act in the case further than to give their judgment; and if the penalties are not mitigated or remitted by the secretary, either before or after judgment, to enforce them by proper process.

The subject has been carefully examined by this court in the case of United States v. Morris, where it is decided 'that the Secretary of the Treasury has authority, under the remission act of March 3d, 1797, to remit a forfeiture or penalty accruing under the revenue laws at any time, before or after judgment, for the penalty, until the money is actually paid over to the collector,' and that 'such remission extends to the shares of the forfeiture or penalty to which the officers of the customs are entitled, as well as to the interests of the United States.'

The court say that, 'It is not denied but that the customhouse officers have an inchoate interest upon the seizure; and it is admitted that this may be defeated by a remission at any time before condemnation. If their interest before condemnation is conditional, and subject to the power of remission, the judgment of condemnation can have no other effect than to fix and determine that interest as against the claimant. These officers, although they may be considered parties in interest, are not parties on the record, and it cannot be said with propriety, that they have a vested right in the sense in which the law considers such rights. Their interest is still conditional, and the condemnation only ascertains and determines the fact on which the right is consummated, should no remission take place.' The right does not become fixed until the receipt of the money by the collector.

If these well-settled principles be applied to the case before us, its solution is easy.

It was the first duty of the collector to collect the amount of duties or taxes on the property seized. The secretary had no right to mitigate, remit, or compromise that amount. Persons who had advanced money on the property in good faith offer the whole amount of the tax due, and finally agreed to pay the sum of $25,000 to have the penalties remitted. This offer was accepted, and the further prosecution of the suits was consequently ended.

The power intrusted by law to the secretary was not a judicial one, but one of mercy, to mitigate the severity of the law. It admitted of no appeal to the Court of Claims, or to any other court. It was the exercise of his discretion in a matter intrusted to him alone, and from which there could be no appeal. Even if we were called upon to review the acts of the secretary, we see no reason to doubt their correctness, or that of the judgment of the Court of Claims in dismissing the case.

DECREE AFFIRMED.

The CHIEF JUSTICE and Mr. Justice NELSON dissented.

title: Dorsheimer v. United States


text: Talk:Dorsheimer v. United States

title: Talk:Dorsheimer v. United States


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


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Page:United States Reports, Volume 545.djvu/976

 Opinion of the Court and StreamCast began to distribute their free software, each one clearly voiced the objective that recipients use it to download copyrighted works, and each took active steps to encourage infringement.

After the notorious file-sharing service, Napster, was sued by copyright holders for facilitation of copyright infringement, A & M Records, Inc. v. Napster, Inc., 114 F. Supp. 2d 896 (ND Cal. 2000), aff’d in part, rev’d in part, 239 F.3d 1004 (CA9 2001), StreamCast gave away a software program of a kind known as OpenNap, designed as compatible with the Napster program and open to Napster users for downloading files from other Napster and OpenNap users’ computers. Evidence indicates that “[i]t was always [StreamCast’s] intent to use [its OpenNap network] to be able to capture email addresses of [its] initial target market so that [it] could promote [its] StreamCast Morpheus interface to them,” App. 861; indeed, the OpenNap program was engineered “ ‘to leverage Napster’s 50 million user base,’ ” id., at 746.

StreamCast monitored both the number of users downloading its OpenNap program and the number of music files they downloaded. Id., at 859, 863, 866. It also used the resulting OpenNap network to distribute copies of the Morpheus software and to encourage users to adopt it. Id., at 861, 867, 1039. Internal company documents indicate that StreamCast hoped to attract large numbers of former Napster users if that company was shut down by court order or otherwise, and that StreamCast planned to be the next Napster. Id., at 861. A kit developed by StreamCast to be delivered to advertisers, for example, contained press articles about StreamCast’s potential to capture former Napster users, id., at 568–572, and it introduced itself to some potential advertisers as a company “which is similar to what Napster was,” id., at 884. It broadcast banner advertisements to users of other Napster-compatible software, urging them to adopt its OpenNap. Id., at 586. An internal e-mail from a company executive stated: “ ‘We have put this network in


text:
Lee County v. Rogers (74 U.S. 181)

In error to the Northern Circuit Court of Illinois.

Rogers brought suit against Lee County, Iowa, upon the coupons of certain bonds signed by one Boyles, county judge, issued by the county under the county seal, to a certain railroad company named.

The defences, as appearing on answer and amended answer, were:

1. That the bonds were issued and executed by Boyles, county judge, &c., 'without any authority of law, having been issued for the purpose of subscribing on behalf of this defendant to the stock of certain railroad corporations, which the defendant had no power or authority to do,' and that they were 'utterly null and void from the beginning.'

2. That a bill had been filed by McMillan and others, taxpayers of Lee County, against Boyles, the county judge, &c., on the 1st October, 1856, in a State court, before any bonds were issued, and that he was enjoined, on account of irregularities in preliminary proceedings, at the December Term, 1856, against issuing the bonds; that soon afterwards, in January, 1857, the legislature passed an act confirming and legalizing these proceedings; that a second bill was filed, by the same parties, on the 26th February, 1859, a year after this act of the legislature, for the purpose of having both the act, and also the bonds, which, in the meantime, had been issued, declared void, and that on the 22d June, 1858, a decree was rendered, declaring both the act and the bonds valid and binding; that a third bill was filed, which was a bill of review of the previous case, on the 28th July, 1860, two years after the previous decree, and that on the 18th October, 1862, a decree was rendered declaring the act of the legislature, and bonds, void and of no effect.

The defence meant to be set up by this second head was, of course, that of lis pendens.

The defendant demurred, and the court below sustaining the demurrer, the case was now brought here by the county.

It was submitted by Mr. McCrary, on elaborate briefs of his own, and of Messrs. Semple and Casey; and by Messrs. Dick and Grant, on similar briefs of theirs.

Mr. Justice NELSON delivered the opinion of the court.

title: Lee County v. Rogers (74 U.S. 181)


text: Talk:Lee County v. Rogers (74 U.S. 181)

title: Talk:Lee County v. Rogers (74 U.S. 181)


text:
Lee County v. Rogers (74 U.S. 181)/Opinion of the Court

The defence is placed, by the learned counsel for the defendant, in his brief, upon two grounds:1. That the county is not liable, on the bonds or coupons, for the reason there was no power in the county to subscribe for the stock, to the railroad company, or to issue the bonds; that they are void, as against the constitution and laws of the State.

2. That prior to the date of the bonds and coupons, certain suits were instituted, in the District Court of Lee County, impeaching the validity of the bonds, if issued, and charging that they would constitute no indebtedness against the county, and claiming that the county judge, who was the fiscal agent of the county, should be enjoined from issuing the bonds; that an injunction was granted, and that the bonds were issued, lite pendente, and put on the market, with full notice of the pendency of the suit; that this suit was continuously and successfully prosecuted, and the courts of the State had adjudged the bonds to be null and void, and the collection of the same perpetually enjoined.

I. As to the power or authority of the county to subscribe for railroad stock, and to issue bonds therefor.

Much the largest portion of the brief of the counsel is devoted to a very able discussion of this question. But, after the decision of this court in the case of Gelpcke v. The City of Dubuque, and the series of cases following it, we must decline a re-examination of the question. We regret the difference of opinion on the subject of these bonds, between this court and the courts of the State of Iowa; but it involves a principle and rule of property, in our opinion, so just, and so essential to the protection of the rights of the bon a fide holder of this class of securities, that, however much we may respect the judgment of those differing from us, we cannot give up our own. That difference, as we understand it, consists in this: This court held, in Gelpcke v. The City of Dubuque, that bonds, issued by counties, cities, or towns, in Iowa, to railroad companies, for stock in said companies, and which said bodies, at the time the bonds were issued, were held, by the settled adjudications of the highest courts of the State, to possess full power, under its constitution and laws, to issue the same, are ever after valid and binding upon the body issuing them, in the hands of a bon a fide holder. Since these bonds were issued, and in the hands of bon a fide holders for value, the courts of Iowa have reversed their previous decisions, and now hold that these bodies possess no such power under the constitution and laws of the State, and hence they are void, even in the hands of the bon a fide holder. The learned and elaborate argument of the counsel for the plaintiff in error, in this case, is devoted to the support of these more recent decisions, and the earnestness and care with which he has discussed the question, Which series of cases shall prevail? leave no doubt of the sincerity of his conviction. But, for the reasons stated, we must respectfully decline following him.

II. The second ground of defence involves the question of notice to the plaintiff below, or, in other words, the effect of the lis pendens, as claimed by the counsel. In order to examine this branch of the defence, understandingly, it will be necessary to recur, for a few moments, to the facts as they appear in the answer.

The first suit, by McMillen and others v. Boyles County Judge, was commenced by petition or bill, October, 1856, and terminated in a decree to enjoin the defendant, December Term thereafter.

The opinion of the Supreme Court, in this case, is in the record. The court held, the election, by the voters in the county, under the direction of the county judge, to have been irregular in several particulars, as not being in conformity to the act providing for a submission of the question of subscribing for the stock and issuing the bonds. At this time it does not appear that any stock had been subscribed for or bonds issued. The question was presented, in this case, and pressed by counsel for the petitioner, whether or not the county possessed competent power to issue the bonds under the constitution and laws of the State? Judge Stockton, who delivered the opinion, as it respects this question, observed, 'We do not deem it expedient or necessary, at the present time, to enter into an examination of the other questions presented and discussed by counsel. Their inherent importance, and the great interest felt in their decision by a large portion of the people of the State, admonish us of the patient study and deliberation with which their investigation must be attended. Another reason, he observes, which has had its weight with us, is, it is understood that the questions raised have been pressed upon, and decided by, the former members of this court, in the case of the County of Dubuque v. The Dubuque and Pacific Railroad Company.'

Soon after this decision, the legislature being in session, an act was passed to cure the defects in the proceedings before the county judge, in the submission of the question to the voters, which became a law on the 29th January, 1857. This act very comprehensive. After confirming the proceedings in the first section, it declares that 'the subscriptions made by said county, & c., and the bonds of said counties, &c., issued in pursuance of said votes and subscription, or hereafter to be issued, are hereby declared to be legal and valid; and that all such bonds issued, and hereafter to be issued, in pursuance of such votes and subscriptions, shall be a valid lien upon the taxable property of said county, &c.'

The second section is equally emphatic. It provides, that 'the county judge, & c., or other proper authorities of said county, &c., shall levy and collect a tax to meet the payment of the principal and interest of such bonds; and the counties, &c., shall not be allowed to plead in any suit brought to recover the principal or interest of such bonds, that the same are usurious, irregular, or invalid, in consequence of the informalities cured by this act.'

The third section re-affirms the validity of all bonds theretofore issued by the county, and the subscriptions to the railroads, notwithstanding any informalities or irregularities in the submission of the question to the vote of the people.

A second suit was brought by petition or bill, by McMillen and others, against the judge of the county, on the 26th February, 1858, to enjoin him from levying a tax, and to have the confirmatory law declared to be unconstitutional, and the bonds void. This suit was commenced more than a year after the passage of the act; and such proceedings were had therein, that the District Court of the County of Lee dismissed it; and, on appeal, this decree was affirmed on the 22d June, 1858. The opinion of the court is in the record. It was delivered by Chief Justice Wright. He observes, 'The power of a county to take stock in a company organized for the purpose of constructing a railroad, or other public improvement, through the same, has been recognized by a majority of this court in the following cases.' He then refers to Dubuque v. Dubuque and Pacific Railroad Company, Leech v. Bissel, County Judge of Cedar County, and Clapp v. Cedar County, and Ring v. Johnson, decided at the present term. He adds, 'While I have never concurred in this ruling, and still deny the power, yet it may now, as I suppose, be regarded as settled.' He then examines the question whether the legislature had power to pass the act of 29th January, 1857; and whether it had the effect of legalizing the vote taken in Lee County, and comes to the conclusion that the legislature was perfectly competent to legalize and make valid the proceedings before the county judge.

This decision of the highest court of the State upon the power of the county to issue the bonds, of which those in question are a part, and also upon the power of the legislature to confirm the irregularities committed in the preliminary steps to their issue, would seem to have put an end to any controversy concerning them. They have the sanction of both the legislative and judicial departments of the State. Higher authority could not be invoked in their favor. If the holders or purchasers cannot confide in these sanctions in parting with their money, they may well despair of any safety or security in their dealings in them.

Now, what is the answer to all this authority?

On the 28th July, 1860, two years after this judgment affirming the validity of the bonds, a petition or bill of review was filed in a district court for the purpose of obtaining a re-examination of the judgment; and such proceedings were had, that on the 18th October, 1862, the Supreme Court adjudged that the bonds and coupons, together with the vote of the county of Lee, by which it is claimed they were authorized, and the subscription to the stock of the railroad companies, and all other acts and things done in and about the premises by the county judge and his predecessors in office, and the levy of taxes, &c., are all unauthorized by law and utterly void; and that the act of the legislature curing or attempting to cure the irregularities in the vote of the county are also held to be null and void. This case is reported in 14 Iowa, p. 107. It is due to the learned counsel for the plaintiff in error to say, that he does not put this branch of the defence on the ground that the last decision in the case should prevail over the prior one holding the bonds to be valid, after the legislative sanction; but puts it on this ground in his own words, namely: 'That the court erred in sustaining the demurrer to the answer and amended answer of defendant, in so far as they set up the pendency of a suit to cancel said bonds at the time of their issue, and at the time of plaintiff's purchase, and which suit being continuously prosecuted resulted in a decree declaring invalid the bonds.'

Now, there are two answers to this ground of defence: First, the suit brought to enjoin the issuing of the bonds for irregularities in the vote of the county, and the judgment enjoining the judge was disposed of by the confirmatory act of the legislature. By that act the irregularities were cured, and the bonds already issued or thereafter to be issued were declared valid. After this act notice was an element of no importance. The suit was at an end. The whole foundation on which it rested was removed. This was so regarded by the plaintiffs, for two years afterwards they brought a second suit to have the bonds declared void for want of power in the county to issue them; and also the act of the legislature for the want of power to confirm the irregularities in the vote. The decision in that case, however, as we have seen, was adverse to both these propositions.

In the second place, there was no pending litigation from the commencement of the first suit to the termination of the last, namely, from the 15th of October, 1856, to the 18th of October, 1862.

There were three distinct and independent suits, with an interval of one year between the first and second, and of two years between the second and third. The doctrine of lis pendens, therefore, has no application to the case.

JUDGMENT AFFIRMED.

Mr. Justice MILLER did not sit in this case.


text: Talk:Lee County v. Rogers (74 U.S. 181)/Opinion of the Court


text:
Gordon v. United States (74 U.S. 188)

APPEAL from the Court of Claims; the case having been thus:

The legal representatives of George Fisher, deceased, by petition represented to the court just named, that during the lifetime of the said George, and in the year 1813, a large amount of his property in Florida was taken or destroyed by the troops of the United States. That before his decease, the said Fisher made application to Congress for compensation for the loss and destruction of his property. That after his decease this application was renewed by his legal representatives. That after a delay of several years, Congress, in 1848, passed an act for the relief of such representatives, authorizing and requiring the Second Auditor of the Treasury Department to examine and adjust their claims on principles of equity and justice, having due regard to the proofs, for the value of the property taken or destroyed; providing that the said representatives should be paid for the same out of any money in the treasury not otherwise appropriated. This law also enacted, that if it should be found impracticable for the claimants to furnish distinct proof as to the specific quantity of property destroyed by the troops, and by the Indians, respectively, it should be lawful for the accounting officer to apportion the losses caused by the two respectively, in such manner as the proofs should show to be just and equitable, so as to afford a full and fair indemnity for all losses occasioned by the troops; but nothing was to be allowed for property destroyed by the Indians.

That this act of Congress was accepted by the claimants, and that the auditor proceeded to examine and adjust the claims under it. That the auditor refused to receive and consider certain depositions presented by the claimants, because he did not consider them properly authenticated. That the auditor made what the petition states to be 'an award' on the 22d April, 1848, allowing one-half of the value of such property as he considered the proof established had been destroyed, assuming, as is alleged, that one-half of the destruction was occasioned by the Indians, and not by the troops. This award amounted to $8873, and did not, as was alleged, include interest or compensation for the losses and injuries sustained.

That in December, 1848, the auditor (at whose instance did not appear) reconsidered the case, corrected an error in calculation of $100 in favor of the claimants in his former report, and allowed interest on the amount as corrected by him, being $8973, from 1832, the date of the first application for relief, to the date of the allowance in 1848, which interest amounted to $8997.94. Not satisfied, the complainants demanded interest from the time of the loss until the award, at the rate of interest allowed in Florida. What that rate was did not appear. This renewed controversy was submitted by the auditor and the claimants to the attorney-general of that day, who gave an opinion that interest at the rate of 6 ''per cent. should be allowed'' from the date of the loss to the time of the allowance. Upon this a further allowance of interest was made by the auditor, amounting to $10,004.89. All which allowances were granted under the original act of April 12, 1848, and were paid to the claimants as fast as the auditor furnished his statements.

The claimants, still feeling aggrieved, renewed their application to Congress, and asked relief from the ruling of the auditor; complaining that he had excluded certain depositions, which he deemed not properly authenticated. Thereupon, on December 22, 1854, Congress passed a supplemental act, directing the auditor to re-examine the case, and to allow the claimants the benefit of the depositions theretofore rejected, provided they were then legally authenticated, the adjustment under this supplemental act to be made in strict accordance with the previous act. What steps, if any, were taken under this supplemental act by the auditor, was not stated.

On the 3d of June, 1858, a joint resolution was passed, devolving upon the Secretary of War the execution of the supplemental act above referred to, directing him to proceed de novo to execute the act and its supplement according to their plain and obvious meaning, but to deduct from any amount which might be found justly and equitably due to the claimants all sums which had been previously paid.

The Secretary of War proceeded to examine the case, and estimated the value of the property destroyed at a sum higher by $158 than the auditor had done; but he also found that all the property had been destroyed by the troops, and none of it by the Indians. Thereupon he allowed for the entire value of the property, instead of half its value, and added interest from the date of the destruction, making a further sum of $39,217.50. This sum was also paid to the claimants.

Still dissatisfied, another petition was presented by the claimants to Congress, and on the 1st of June, 1860, another joint resolution was passed, authorizing and requiring the Secretary of War to revise his execution of the supplemental act aforesaid, and on such revision to give effect to all the testimony filed, including the depositions formerly rejected by the auditor, and to restate and resettle the account, and to make such corrections in his former statement and settlement, and such further allowances, if any, as, in his opinion, justice to the claimants should require. The Secretary of War (then Mr. Floyd) did revise his statement and resettle the account; and on the 23d November, 1860, stated his conclusions in favor of the claimants, making a further allowance of $66,519.85.

The object of the petition now filed in the Court of Claims was, to obtain from this court a judgment for this further allowance of $66,519.85.

It appeared, however, that on the 2d of March, 1861, Congress had passed a joint resolution declaring the resolution of the 1st of June, 1860, under which the Secretary of War had made the last allowance, rescinded, and pronounced the same and all the proceedings under it null and void.

But the petitioners averred, that this repealing resolution was passed without their Knowledge or consent, and without notice to them. By reason of it they had not been paid.

The petition was demurred to by the United States.

The court below, considering that there was no cause of action set up in the petition save that founded upon the finding of the Secretary of War, under the resolution approved June 1, 1860, styled an award, and holding that that resolution, and all action under it, became null by the repeal of March 2, 1861, sustained the demurrer and dismissed the petition.

The only question, therefore, presented here, was, whether the court below gave a proper construction to the repealing resolution of March 2, 1861. It was, however, asserted by the claimant, that if this construction was erroneous, this court ought to give the same judgment which the court below should have given, to wit: a judgment for the amount of the award with interest. The whole subject of interest, as allowed in the awards, was also made a matter of discussion.

Mr. Bennett, for the appellant, contended, that an award having been made under the law of 1860, the repeal of the law of 1861 could not divest it. Rights had vested. 'In such a case,' says Dr. Bouvier, 'the rights acquired are left unaffected.' That in fact the arbitrator having made and published his award, the resolution of June 1st, 1860, was executed, and nothing remained to be repealed. The case came thus within the principle of Bayne v. Morris.

As respected interest: All money due and unpaid properly draws interest. An exception is made in favor of governments, because they are presumed to be always ready to pay, and that any non-payment is owing to the fault of the creditor in not presenting his claim. Here the presumption is rebutted in every part of the case. As respected the awards of interest (though they were not now in question) they were right, both on general principles and under the statute. The case was to be settled 'on principles of equity and justice.' There was to be 'a full and fair indemnity.'

Mr. Norton, contra, argued, that Bayne v. Morris was the case of an 'award' in its proper sense, and was not applicable to this case; that on the contrary, the finding of the secretary in cases like this had been decided in De Groot v. United, States not to be an 'award,' nor in that sense binding.

The whole matter of interest was therefore unimportant, though the court could hardly fail to disapprove such allowances as had been made here.

Mr. Justice GRIER delivered the opinion of the court.

title: Gordon v. United States (74 U.S. 188)


text: Talk:Gordon v. United States (74 U.S. 188)