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Oscanyan v. Arms Company/Opinion of the Court

This is an action to recover the sum of $136,000, alleged to be due to the plaintiff upon a contract with the defendant, as commissions on the sales of fire-arms to the Turkish government, effected through his influence. The defendant pleads the general issue. At the time the transactions occurred, out of which this action has arisen, the plaintiff was consul-general of the Ottoman government at the port of New York. The defendant is a corporation, created under the laws of Connecticut. The action was originally commenced in the Supreme Court of New York, and on motion of the defendant, was removed to the Circuit Court of the United States. When it was called for trial, and the jury was impanelled, one of the plaintiff's counsel, as preliminary to the introduction of testimony, stated to the court and jury the issues in the case, and the facts which they proposed to prove. From such statement it appeared that the sales for which commissions were claimed by the plaintiff were made whilst he was an officer of the Turkish government, and through the influence which he exerted upon its agent sent to this country to examine and report in regard to the purchase of arms. The particulars of the services rendered will be more fully mentioned hereafter. It is sufficient now to say that the defendant, considering that the facts which the plaintiff proposed to prove showed that the contract was void as being corrupt in itself and prohibited by morality and public policy, upon which no recovery could be had, moved the court to direct the jury to render a verdict in its favor. The court thereupon inquired of the plaintiff's counsel if they claimed or admitted that the statements which had been made were true, to which they replied in the affirmative. Argument was then had upon the motion, after which the court directed the jury to find a verdict for the defendant, which was accordingly done. Judgment being entered upon it, the case was brought to this court for review. The reversal of the judgment is sought for alleged errors of the court below in three particulars:--

1st, In directing a verdict for the defendant upon the opening statement of the plaintiff's counsel;

2d, In holding that the question of the illegality of the contract could be considered in the case, the same not having been specially pleaded; and,

3d, In adjudging that the contract set forth in the opening statement was illegal and void.

Each of these grounds will be carefully examined.

1. Several reasons are presented against the power of the court to direct a verdict upon the statement of the facts which the plaintiff proposed to prove, that might be more properly urged against its exercise in particular cases. The power of the court to act in the disposition of a trial upon facts conceded by counsel is as plain as its power to act upon the evidence produced. The question in either case must be whether the facts upon which it is called to instruct the jury be clearly established. If a doubt exists as to the statement of counsel, the court will withhold its directions, as where the evidence is conflicting, and leave the matter to the determination of the jury.

In the trial of a cause the admissions of counsel, as to matters to be proved, are constantly received and acted upon. They may dispense with proof of facts for which witnesses would otherwise be called. They may limit the demand made or the set-off claimed. Indeed, any fact, bearing upon the issues involved, admitted by counsel, may be the ground of the court's procedure equally as if established by the clearest proof. And if in the progress of a trial, either by such admission or proof, a fact is developed which must necessarily put an end to the action, the court may, upon its own motion, or that of counsel, act upon it and close the case. If, on a trial for a homicide, to take an illustration suggested by counsel, it should appear from the opening statement that the accused had been pardoned for the offence charged, it would be a waste of time to listen to the evidence of his original criminality; for if established he would still be entitled to his discharge by force of the pardon. So in a civil action, if it should appear from the opening statement that it is brought to obtain compensation for acts which the law denounces as corrupt and immoral, or declares to be criminal, such as attempts to bribe a public officer, or to evade the revenue laws, or to embezzle the public funds, the court would not hesitate to close the case without delay. Of course, in all such proceedings nothing should be taken, without full consideration, against the party making the statement or admission. He should be allowed to explain and qualify it, so far as the truth will permit; but if, with such explanation and qualification, it should clearly appear that there could be no recovery, the court should not hesitate to so declare and give such direction as will dispose of the action.

Here there were no unguarded expressions used, nor any ambiguous statements made. The opening counsel was fully apprised of all the facts out of which his client's claim originated, and seldom was a case opened with greater fulness of detail. He dwelt upon and reiterated the statement of the fact which constituted the ground of the court's action in directing a verdict for the defendant, namely, that it was Oscanyan's influence alone which controlled the agent of the Turkish government; and for the use of that influence the defendant had agreed to give the compensation demanded,-that is to say, that whilst an officer of the Turkish government the plaintiff had stipulated for a commission on contracts obtained from it through his personal influence over its agent. Had the case been pending in a court of some of the States, or in an English court, a nonsuit would have been ordered, if the facts stated had been deemed fatal to the action. Involuntary nonsuits not being allowed in the Federal courts, the course adopted was the proper proceeding. The difference in the two modes is rather a matter of form than of substance, except in the case of a nonsuit a new action may be brought, whereas in the case of a verdict the action is ended, unless a new trial be granted either upon motion or upon appeal.

The language of this court in numerous cases is in accordance with these views, though used with reference to directing a verdict after evidence is received. But, as already stated, it cannot make any difference as to the power of the court, whether the facts be developed by the evidence or be admitted by counsel. In Merchants' Bank v. State Bank it appeared, that, upon the evidence on behalf of the plaintiff being closed the defendant's counsel moved the court below to instruct the jury that it was not sufficient to enable them to find a verdict for the plaintiff. The instruction was given, and the jury found for the defendant. The case being brought here on writ of error, this court said, speaking through Mr. Justice Swayne: 'According to the settled practice in the courts of the United States, it was proper to give the instruction, if it were clear the plaintiff could not recover. It would have been idle to proceed further when such must be the inevitable result. The practice is a wise one; it saves time and costs; it gives the certainty of applied science to the results of judicial investigation; it draws clearly the line which separates the provinces of the judge and jury, and fixes where it belongs the responsibility which should be assumed by the court.' 10 Wall. 604, 637.

In Pleasants v. Fant, this court, speaking of a case where the evidence was insufficient to justify a verdict, and where it would be the duty of the court below to set it aside and grant a new trial, said, speaking through Mr. Justice Miller: 'Must the court go through the idle ceremony in such a case of submitting to the jury the testimony on which plaintiff relies, when it is clear to the judicial mind that if the jury should find a verdict in favor of plaintiff, that verdict would be set aside and a new trial had? Such a proposition is absurd, and accordingly we hold the true principle to be that if the court is satisfied that, conceding all the inferences which the jury could justifiably draw from the testimony, the evidence is insufficient to warrant a verdict for the plaintiff, the court should say so to the jury.' 22 Wall. 116, 122.

In Railroad Company v. Fraloff it was claimed by the company that the court below erred in not giving a peremptory instruction for a verdict in its favor. But this court, whilst holding the position untenable, said, speaking through Mr. Justice Harlan: 'Had there been no serious controversy about the facts, and had the law, upon the undisputed evidence, precluded any recovery whatever against the company, such an instruction would have been proper.' 100 U.S. 24, 26.

Indeed, there can be, at this day, no serious doubt that the court may at any time direct a verdict when the facts are undisputed, and that the jury should follow such direction. The maxim that questions of fact are to be submitted to the jury, and not to be determined by the court, is not violated by this proceeding any more than by a nonsuit in a State court where the plaintiff fails to make out his case. The intervention of the jury is required only where some question of fact is controverted.

Our conclusion, therefore, is that the first position of the plaintiff is not well taken.

The suggestion in the argument, that the counsel who made the opening had been called into the case only two days before the trial, and was not, therefore, fully prepared to open it, does not merit consideration. In the first place, the record does not show that any application was made to the court for a postponement of the trial on that ground; in the second place, two days ought to have been ample time for the counsel to acquaint himself with the essential facts of the case; and in the third place, no new fact is even now mentioned that would have materially changed his statement.

2. The position of the plaintiff that the illegality of the contract in suit cannot be noticed, because not affirmatively pleaded, does not strike us as having much weight. We should hardly deem it worthy of serious consideration had it not been earnestly pressed upon our attention by learned counsel. The theory upon which the action proceeds is that the plaintiff has a contract, valid in law, for certain services. Whatever shows the invalidity of the contract, shows that in fact no such contract as alleged ever existed. The general denial under the Code of Procedure of New York, or the general issue at common law, is therefore, sustained by proof of the invalidity of the transaction which is designated in the complaint or declaration as a contract.

Whilst, however, at the common law, under the general issue in assumpsit, it was always admissible to give in evidence any matter which showed that the plaintiff never had a valid cause of action, in practice many other matters were allowed under that plea, such as went to the discharge of the original cause of action, and showed that none subsisted at the commencement of the suit,-such as payment, release, accord and satisfaction, and a former recovery, and excuses for non-performance of the contract; and also that it had become impossible or illegal to perform it. 1 Chitty, Pleading, 493; Craig v. The State of Missouri, 4 Pet. 410-426; Edson v. Weston, 7 Cow. (N. Y.) 278; Young v. Rummell, 2 Hill (N. Y.), 478. It followed that there were many surprises at the trial by defences which the plaintiff was not prepared to meet. The English courts, under the authority of an act of Parliament passed in the reign of William IV., adopted rules which, to some extent, corrected the evils arising from this practice of allowing defences under the general issue which did not go directly to the validity of the original cause of action. And the Code of Procedure of New York did away entirely with the practice in that State, and required parties relying upon anything which, admitting the original existence of the cause of action, went to show its discharge,-such as a release or payment, or other matter,-to plead it specially, in order that the plaintiff might be apprised of the grounds of defence to the action. We do not understand that the code makes any other change in the matters admissible under the general denial.

But if we are mistaken in this view of the system of procedure adopted in New York, and of the defences admissible according to it under a general denial in an action upon a contract, our conclusion would not be changed in the present case. Here the action is upon a contract which, according to the view of the judge who tried the case, was a corrupt one, forbidden by morality and public policy. We shall hereafter examine into the correctness of this view. Assuming for the present that it was a sound one, the objection to a recovery could not be obviated or waived by any system of pleading, or even by the express stipulation of the parties. It was one which the court itself was bound to raise in the interest of the due administration of justice. The court will not listen to claims founded upon services rendered in violation of common decency, public morality, or the law. History furnishes instances of robbery, arson, and other crimes committed for hire. If, after receiving a pardon, or suffering the punishment imposed upon him, the culprit should sue the instigator of the crime for the promised reward,-if we may suppose that audacity could go so far,-the court would not hesitate a moment in dismissing his case and sending him from its presence, whatever might be the character of the defense. It would not be restrained by defects of pleading, nor, indeed, could it be by the defendant's waiver, if we may suppose that in such a matter it would be offered. What is so obvious in a case of such aggravated criminality as the one supposed, is equally true in all cases where the services for which compensation is claimed are forbidden by law, or condemned by public decency or morality.

This doctrine was applied in Coppell v. Hall, reported in 7th Wallace. In that case Coppell was the acting British consul in New Orleans, and during the late civil war entered into a contract with one Hall, by which the latter agreed to furnish him with sundry bales of cotton, which he was to cause to be protected from seizure by our forces and transported to New Orleans, and there disposed of to the best advantage, he to receive one-third of the profits for his compensation. For breach of this contract he sued Hall, who set up that the contract was against public policy and void, and also a reconventional demand or counterclaim for damages for a breach of the contract by Coppell. On the trial, the court below, among other things, instructed the jury that if the contract was illegal, the illegality had been waived by the reconventional demand of the defendant; but this court said, speaking through Mr. Justice Swayne, that the instruction 'was founded upon a misconception of the law. In such cases,' he added, 'there can be no waiver. The defence is allowed, not for the sake of the defendant, but of the law itself. The principle is indispensable to the purity of its administration. It will not enforce what it has forbidden and denounced. The maxim, ex dolo malo non oritur actio, is limited by no such qualification. The proposition to the contrary strikes us as hardly worthy of serious refutation. Whenever the illegality appears, whether the evidence comes from one side or the other, the disclosure is fatal to the case. No consent of the defendant can neutralize its effect. A stipulation in the most solemn form to waive the objection would be tainted with the vice of the original contract, and void for the same reasons. Wherever the contamination reaches it destroys. The principle to be extracted from all the cases is, that the law will not lend its support to a claim founded upon its violation.' See also Holman v. Johnson, 1 Cowp. 341.

Approving of the doctrine so well expressed in this citation, our conclusion is, that the second position of the plaintiff is not well taken.

3. We are brought, then, to the consideration of the contract upon which the action is founded. This is given in the opening statement of the plaintiff, with full particulars of the services rendered. We need only repeat its essential portions. As already mentioned, he was, at the time, consul-general of the Ottoman government at the port of New York. For many years previously to 1869 he had resided in the United States, and was familiar with our language. In that year the Turkish government sent Rustem Bey, an officer of high rank in its service, to the United States to examine and report in regard to the purchase of arms and machinery for its use. He was a friend of the plaintiff; had known him many years, and their relations were intimate. On his arrival in this country he made the plaintiff's office his headquarters, and there all his interviews and negotiations with the manufacturers of arms were had, and, as he did not speak English, these interviews and negotiations were conducted through the plaintiff. The manufacturers soon became aware of the relation of the men to each other, and accordingly opened a correspondence with the plaintiff, or waited upon him, to secure his influence with the Bey in presenting their arms. Among others, Winchester, the president of the Winchester Repeating Arms Company, of Connecticut, the defendant here, sought an introduction to him, and the scene is thus narrated: 'Said Mr. Winchester to Oscanyan, 'Will you be kind enough to call the attention of Rustem Bey to my repeating rifle?' 'Well,' said Oscanyan, 'Mr. Winchester, I am receiving commissions from all parties for that favor, and I expect commissions for my services, and that is one of the ways by which I make my livelihood; if you can compensate me, if you can remunerate me by giving me commissions, I will use my influence for you and do all I can for you.' 'Very well,' said Mr. Winchester, 'that is all right. You shall have whatever commissions we deem proper, and we will talk the matter over and agree upon that.' Accordingly Oscanyan showed the Winchester repeating rifle to Rustem Bey,' who was not pleased with it, but through Oscanyan's influence was induced to send samples of it to Constantinople.

In January, 1870, the Bey received instructions from the Turkish minister of ordinance to examine and report upon the Spencer gun. These instructions were given because the Turkish government had heard that the United States had a large number of these guns on hand which they desired to dispose of. They immediately became known to Oscanyan, and as he had agreed with Winchester to press the claims of the Winchester gun, he at once proceeded to use his influence with the Bey to condemn the Spencer gun. The opening statement says that 'he raised all manner of objections that he could, and he finally did succeed in inducing' the Bey to put it aside. Then he brought out a Winchester gun, a sample of which he always kept in his office for the very purpose, whenever opportunity offered, of presenting its claims. It appears, however, that the Bey did not, from the first, like that gun, and for that reason, continues the opening statement, 'Oscanyan had to use all his ingenuity and skill and perseverance and patience' to get him to look at it at all; but finally he succeeded in getting him to recommend the purchase of a thousand of them for the use of the imperial body-guard. This, said the plaintiff's counsel, was done by the Bey 'in order to please Oscanyan,' knowing the fact that he had an arrangement with the defendant for a commission on the sale. Accordingly the Bey reported to the Turkish government, condemming the Spencer gun and recommending the purchase of the Winchester repeating arms. Soon afterwards Oscanyan informed Winchester of what he had done, when the latter remarked that he would have allowed Oscanyan the same commissions on the Spencer guns as on the others. Oscanyan replied that the United States had a large number of them on hand, and if the Bey had reported favorably on that gun, the Turkish government would have ordered them directly from the United States government. It was that reason, said Oscanyan, which 'weighed on my mind' to persuade the Bey to condemn the gun.

In February, 1870, the Bey received fresh instructions to inquire into and report upon the price of twenty thousand repeating arms, and to send fresh samples. Oscanyan soon learned of this and immediately telegraphed for Winchester, who arrived at his office on the following day, when Oscanyan informed him that he had got an order for twenty thousand guns, or an inquiry for the price of twnenty thousand, and thought he could get an order for one hundred thousand. He then called Winchester's attention to an objection raised by the Bey relating to the spring of the magazine of the rifle, and advised him to meet it; and this advice was acted upon. Soon afterwards Winchester, as president of the company, put in writing his agreement with Oscanyan, to give ten per cent upon all sales of arms of the company made to or by the latter to the Ottoman government, provided that such sales were made at prices and upon terms having his approval. This was dated on the 4th of March, 1870. On the following day a box of fresh samples was forwarded to the Turkish minister of ordnance at Constantinople, and, after a delay of some months for the receipt of the cartridges, a trial of them was had with a favorable result. Written contracts between the defendant and the Turkish government followed; one made Nov. 9, 1870, for arms to the amount of $520,000, and another made Aug. 19, 1871, for arms to the amount of $840,000.

The plaintiff claims that these contracts were procured through the recommendations which by his influence were made by Rustem Bey. His counsel stated this in his opening, and declared that no other person had possessed any influence in effecting the sales. It is for the use of this influence that the contract in suit was made and compensation is now demanded. The question then arises, Is this contract one which the court will enforce? We have no hesitaton in answering it in the negative. The contract was a corrupt one,-corrupt in its origin and corrupting in its tendencies. The services stipulated and rendered were prohibited by considerations of morality and policy which should prevail at all times and in all countries, and without which fidelity to public trusts would be a matter of bargain and sale, and not of duty.

In the first place, the plaintiff was, at the time, an officer of the Turkish government. As its consul-general at the port of New York, he was invested with important functions and entitled to many privileges by the law of nations. It is not necessary here to state with any particularity the functions and privileges attached to the consular office. These will be found in any of the approved treatises on international law.

It is enough to observe that a consul is an officer commissioned by his government for the protection of its interests and those of its citizens or subjects; and whilst he is sometimes allowed, in Christian countries, to engage in commercial pursuits, he is so far its public agent and commercial representative that he is precluded from undertaking any affairs or assuming any position in conflict with its interests or its policy. By some governments he is invested-in the absence of a minister or ambassador to represent them-with diplomatic powers, and, as between their citizens or subjects, may also exercise judicial functions. By all governments his representative character is recognized, and for that reason certain exemptions and privileges are granted to him. In the Constitution of the United States, consuls are classed with ministers and ambassadors in the enumeration of parties whose cases are subject to the original jurisdiction of the Supreme Court, and in the treaty with the Ottoman Empire authority is given to it to appoint consuls in the United States.

It was stated in the argument that the office held by the plaintiff was an honorary one, created especially as an evidence of the high regard entertained for him by the government of his country, as if the objection to his claim of a right to exact a commission on contracts with it, made through his influence, was obviated by the fact that he received no salary for the discharge of his official duties. Assuming the office to have been purely an honorary one, we do not perceive how this circumstance could in any respect alter his relations to that government. If conferred as a mark of honor, the fact would seem to impose upon him increased obligation to avoid any departure from the line of duty. The members of Parliament in England receive no pay for their services, and the expenses of many official positions, in this and other countries, exceed the compensation allowed to the incumbents; but this circumstance would not excuse much less justify them in sacrificing the public interests for individual gains or profits. All such positions are trusts to be exercised from considerations of duty and for the public good. Whenever other considerations are allowed to intervene and control their exercise, the trust is perverted and the community suffers. The plaintiff, it is true, was not the purchasing agent of the Turkish government, but he was its honored officer, upon whose fidelity to its interests it had a right to rely in any advice which he might give to its agent. But so far from justifying this confidence, the only motive upon which he appears to have acted was the hope of gain to himself by high commissions on the sales effected. As justly remarked by the judge who tried the case, the benefits which would inure to the government of which he was the commercial representative, do not seem to have entered into the considerations which influenced his mind.

But, independently of the official relation of the plaintiff to his government, the personal influence which he stipulated to exert upon another officer of that government was not the subject of bargain and sale. Personal influence to be exercised over an officer of government in the procurement of contracts, as justly observed by counsel, is not a vendible article in our system of laws and morals, and the courts of the United States will not lend their aid to the vendor to collect the price of the article. Numerous adjudications to this effect are found in the State and Federal courts. This is true when the vendor holds no official relations with the government, though the turpitude of the transaction becomes more glaring when he is also its officer.

In Tool Company v. Norris, reported in the 2d of Wallace, this court held that an agreement for compensation to procure a contract with the government to furnish it with supplies was against public policy and could not be enforced. That was a case where the compensation was made contingent upon success in procuring the contract, and, as we shall hereafter show, should be distinguished from agreements for services in presenting information on the subject for the consideration of the government. It was a case where nothing was to be paid if no contract was obtained, and if obtained the compensation was to be proportionate to its extent. In deciding the case the court said: 'Considerations as to the most efficient and economical mode of meeting the public wants should alond control in this respect the action of every department of government. No other consideration can lawfully enter into the transaction, so far as the government is concerned. Such is the rule of public policy, and whatever tends to introduce any other elements into the transaction is against public policy. That agreements like the one under consideration have this tendency is manifest. They tend to introduce personal solicitation and personal influence as elements in the procurement of contracts, and thus directly lead to inefficiency in the public service and to unnecessary expenditures of the public funds. . . . All agreements for pecuniary considerations to control the business operations of the government or the regular administration of justice, or the appointments to public offices, or the ordinary course of legislation, are void as against public policy, without reference to the question whether improper means are contemplated or used in their execution. The law looks to the general tendency of such agreements, and it closes the door to temptation by refusing them recognition in any of the courts of the country.'

In this case the doctrine of the court in Marshall v. Baltimore & Ohio Railroad Co., reported in 16th Howard, was emphasized. There compensation was claimed by the plaintiff for services rendered in procuring the passage of a law by the legislature of Virginia, upon a contract that if the law was not passed, or, if passed, was not accepted and adopted or used by the stockholders, no compensation should be allowed. It was held that the contract was void as against public policy. The court, speaking through Mr. Justice Grier, said: 'Bribes in the shape of high contingent compensation must necessarily lead to the use of improper means and the exercise of undue influence. Their necessary consequence is the demoralization of the agent who covenants for them; he is soon brought to believe that any means which will produce so beneficial a result to himself are 'proper means;' and that a share of these profits may have the same effect of quickening the perceptions and warming the zeal of influential or 'careless' members in favor of his bill.' See also Wood v. McCann, 6 Dana (Ky.), 366; Mills v. Mills, 40 N. Y. 543.

In Trist v. Child, reported in 21st of Wallace, the distinction is drawn between the use of personal influence to secure legislation, and legitimate professional services in making the legislature acquainted with the merits of the measures desired. Whilst the former is condemned, the latter are, within certain limits, regarded as appropriate subjects for compensation. There the defendant had employed the plaintiff to get a bill passed by Congress for an appropriation to pay a claim against the United States. It was considered by the court to have been a contract for lobby services, and adjudged void as against public policy. Other similar cases were mentioned by the court, and, after observing that in all of them the contract was held to be against public policy and void, it added, speaking through Mr. Justice Swayne: 'We entertain no doubt that in such cases, as under all other circumstances, an agreement, express or implied, for purely professional services is valid. Within this category are included drafting the petition to set forth the claim, attending to the taking of testimony, collecting facts, preparing arguments, and submitting them, orally or in writing, to a committee or other proper authority, and other services of like character. All these things are intended to reach only the reason of those sought to be influenced. They rest on the same principle of ethics as professional services rendered in a court of justice, and are no more exceptionable. But such services are separated by a broad line of demarcation from personal solicitation, and the other means and appliances which the correspondence shows were resorted to in this case.'

So, too, with reference to furnishing the government with arms or supplies of any kind. It is legitimate to lay before the officers authorized to contract, all such information as may apprise them of the character and value of the articles offered, and enable them to act for the best interests of the country. And for such services compensation may be had as for similar services with private parties, either upon a quantum meruit, or, where a sale is effected, by the ordinary brokerage commission. And here it may be observed, in answer to some authorities cited, that the percentage allowed by established custom of commission merchants and brokers, though dependent upon sales made, is not regarded as contingent compensation in the obnoxious sense of that term, which has been so often the subject of animadversion by this court, as suggesting the use of sinister or corrupt means for accomplishing a desired end. They are the rates established by merchants for legitimate services in the regular course of business. But where, instead of placing before the officers of the government the information which should properly guide their judgments, personal influence is the means used to secure the sales, and is allowed to prevail, the public good is lost sight of, unnecessary expenditures are incurred, and, generally, defective supplies are obtained, producing inefficiency in the public service.

In Meguire v. Corwine, decided at the last term, the doctrine of the above cases was approved. There an agreement to pay the plaintiff-in consideration of his appointment as government counsel-one-half the fees he might recover, was adjudged invalid. Transactions of the kind were declared to be 'an unmixed evil;' and the court said that whether forbidden by statute or condemned by public policy, 'no legal right can spring from such a source.' 101 U.S. 108, 111.

In the present case there is no feature that relieves the contract which the plaintiff seeks to enforce from the condemnation pronounced in the several cases cited. It is the naked case of one officer of a government, to secure its purchase of arms, selling his influence with another officer in consideration of a commission on the amount of the purchase. The courts of the United States will not lend their aid to collect compensation for services of this nature; nor does it make any difference that the Turkish government did not object to the plaintiff's taking commission on such contracts, which counsel contended we must consider as admitted together with the rest of the opening statement. We may doubt whether we are compelled to take as correct, with the facts mentioned touching the contract in court, his statement of the law or customs of other countries. But admitting this to be otherwise, and that the Turkish government was willing that its officers should be allowed to take commissions on contracts obtained for it by their influence, that is no reason why the courts of the United States should enforce them. Contracts permissible by other countries are not enforceable in our courts, if they contravene our laws, our morality, or our policy. The contract in suit was made in this country, and its validity must be determined by our laws. But had it been made in Turkey, and were it valid there, it would meet with the same reprobation when brought before our courts for enforcement.

The general rule undoubtedly is that the validity of a contract is to be decided by the law of the place where it is made, unless it is to be performed in another country; but to this, as to all general rules, there are are founded in moral turpitude, Story mentions contracts made in a foreign country to promote or reward the commission of crime, to corrupt or evade the due administration of justice, to cheat public agents, or to affect the public rights, and other contracts which in their nature are founded in moral turpitude and are inconsistent with the good order and solid interest of society. 'All such contracts,' he adds, 'even although they might be held valid in a country where they are made, would be held void elsewhere, or at least ought to be, if the dictates of Christian morality, or even of natural justice, are allowed to have their due force and influence in the administration of international jurisprudence.' Story, Conflict of Laws, sect. 258.

Among such obnoxious contracts must be included all such as have for their object the control of public agents by considerations conflicting with their duty and fidelity to their principals. A contract to bribe or corruptly influence officers of a foreign government will not be enforced in the courts of this country,-not from any consideration of the interests of that government or any regard for its policy, but from the inherent viciousness of the transaction, its repugnance to our morality, and the pernicious effect which its enforcement by our courts would have upon our people. Hope v. Hope, 8 De G., M. & G. 731; Watson v. Murray, 23 N. J. Eq. 257.

In any view of the contract here, whether it would be valid or invalid according to Turkish law and customs, it is intrinsically so vicious in its character and tendency, and so repugnant to all our notions of right and morality, that it can have no countenance in the courts of the United States.

Our conclusion, therefore, is that the third position of the plaintiff is not well taken.

It follows that the judgment of the court below must be affirmed; and it is

So ordered.


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Bondurant Tutrix v. Watson

ERROR to the Supreme Court of the State of Louisiana.

The writ of error in this case is as follows:--

'UNITED STATES OF AMERICA,

'State of Louisiana, ss:

'The Hon. Chief Justice of the Supreme Court of the State of Louis'a, to the Clerk of the Supreme Court of the State of Louisiana, greeting:

'Because in the record and proceedings, as also in the rendition of the judgment of a plea, which is in our said Supreme Court, before us, between Frank Watson, plaintiff, and Mrs. Ella F. Bondurant, tutrix, &c., defendant, No. 6564 on the docket of this court, it is claimed by the said defendant that, being a citizen of the State of Mississippi, and the said Watson being a citizen of Louisiana, and in the said cause the rights, titles, and privileges of said defendant, Mrs. Bondurant, tutrix, &c., under the statutes and under the Constitution of the United States, are by her claimed, and that the decision and judgment of this honorable Supreme Court of Louisiana is against the said titles, rights, and privileges of said defendant, Mrs. Bondurant, specially set up under the laws and the Constitution of the United States, and because the said Mrs. Bondurant has filed her petition herein for a writ of error to the hon. Supreme Court of the United States at Washington, D. C., claiming that a manifest error hath happened, to the great damage of the said defendant, Mrs. E. F. Bondurant, executrix, tutrix, &c., as by said defendant's complaint appears: We being willing that error, if any hath been, should be duly corrected, and full and speedy justice done to the parties aforesaid in this behalf, do command you, if judgment be therein given, that then under your seal, distinctly and openly, you send the record and proceedings aforesaid, with all things concerning the same, to the Supreme Court of the United States, together with this writ, so that you have the same at Washington, on the second Monday of October next, in the said Supreme Court, to be then and there held, that the record and proceedings aforesaid being inspected, the said Supreme Court may cause further to be done therein to correct that error what of right, and according to the laws and customs of the United States, should be done.

'Witness the Honorable T. C. Manning, Chief Justice of the said Supreme Court of Louisiana, this fifteenth day of December, in the year of our Lord one thousand eight hundred and seventy-seven.

[SEAL.]

'ALF'D ROMAN,

'Clerk of the Supreme Court of Louisiana.'

Mr. Samuel R. Walker for the plaintiff in error.

Mr. Edwin T. Merrick and Mr. George W. Race, contra.

MR. CHIEF JUSTICE WAITE delivered the opinion of the court.

title: Bondurant Tutrix v. Watson


text: Talk:Bondurant Tutrix v. Watson

title: Talk:Bondurant Tutrix v. Watson


text:
Bondurant Tutrix v. Watson/Opinion of the Court

We have no jurisdiction in this case, as no writ of error has ever been issued. Mussina v. Cavazos, 6 Wall. 355. By the ninth section of the act of May 8, 1792, c. 36 (1 Stat. 278), it was made the duty of the clerk of this court to transmit to the clerks of the several courts the form of a writ of error approved by two of the justices of this court. This was done, and the form adopted required the writ to be issued in the name of the President of the United States, and have the teste of the Chief Justice of this court. Sect. 1004 of the Revised Statutes is as follows:--

'Writs of error returnable to the Supreme Court may be issued     as well by the clerks of the circuit courts under the seals      thereof, as by the clerk of the Supreme Court. When so issued     they shall be, as nearly as each case may admit, agreeable to the form of a      writ of error transmitted to the clerks of the several      circuit courts by the clerk of the Supreme Court, in      pursuance of section nine of the act of May eight, seventeen      hundred and ninety-two, chapter thirty-six.'

The writ in this case was in the name of the Chief Justice of the Supreme Court of the State of Louisiana. It bore the teste of that Chief Justice, and was signed by the clerk, and sealed by the seal of that court. It had not a single requisite of a writ of this court. Had it been even colorably issued from this court, it might have been amended under sect. 1005 of the Revised Statutes, which is certainly very liberal, and as follows:--

'The Supreme Court may, at any time, in its discretion and     upon such terms as it may deem just, allow an amendment of a      writ of error, when there is a mistake in the teste of the      writ, or a seal to the writ is wanting, or when the writ is      made returnable on a day other than the day of the      commencement of the term next ensuing the issue of the writ,      or when the statement of the title of the action or parties      thereto in the writ is defective, if the defect can be      remedied by reference to the accompanying record, and in all      other particulars of form: Provided the effect has not      prejudiced, and the amendment will not injure, the defendant      in error.'

But here there is nothing which even purports to be a writ from this court, and there is, therefore, nothing to amend. If we should permit the parties to change the seal, or the title, or to do everything else which this section allows, there would still be no writ, for nothing has been done either in the name of the President or under the authority of the United States. The Supreme Court of the State has directed that its record be certified here for examination and review, but no writ to that effect either in form or substance has ever issued from this court. As such a writ is necessary to our jurisdiction, the suit is

Dismissed.


text: Talk:Bondurant Tutrix v. Watson/Opinion of the Court


text:
Bondurant v. Watson

APPEAL from the Circuit Court of the United States for the District of Louisiana.

The facts are stated in the opinion of the court.

Mr. Samuel R. Walker for the appellant.

Mr. Edwin T. Merrick and Mr. George W. Race, contra.

MR. JUSTICE WOODS delivered the opinion of the court.

title: Bondurant v. Watson


text: Talk:Bondurant v. Watson

title: Talk:Bondurant v. Watson


text:
Bondurant v. Watson/Opinion of the Court

Daniel Bondurant died seised of a large plantation in the parish of Tensas, in the State of Louisiana. His estate descended to his three sons, Albert, Horace, and John, and to Walter E. Bondurant, his infant grandson.

In 1852, upon petition of the sons for a partition of the plantation, a decree of sale was made, under which it was sold, and struck off to them for the price of $150,000. Of this sum, Walter, the grandson, was entitled to one-fourth, namely, $37,500.

The sheriff, on Dec. 4, 1858, executed a deed to the sons, reserving therein a special mortgage and privilege on the lands in favor of Walter E. Bondurant for his share of the purchasemoney.

In the act of sale, which was executed both by the sheriff and the purchasers, the latter bound themselves not to alienate, deteriorate, or incumber the property to the prejudice of the mortgage, an agreement known in the local jurisprudence of Louisiana as the pact de non alienando. The mortgage was recorded Dec. 6, 1852. The law of Louisiana required it to be reinscribed within ten years from that date. It was not reinscribed until September 1865. The three sons of Daniel Bondurant divided the plantation between them. The part which is in controversy in this suit was set off to John Bondurant, who, in 1854, conveyed it to one Augustus C. Watson, Sen.

On Jan. 30, 1866, Walter E. Bondurant began an action against his uncles, Albert, Horace, and John Bondurant, in the District Court for the Parish of Tensas, to recover judgment against them for his part of the purchase price of said plantation, and to enforce his mortgage and privilege thereon. The court rendered a judgment in his favor for the sum of $37,500, with interest, and ordered, adjudged, and decreed that the authentic act of mortgage, which was the basis of the action, should be, and the same was thereby, rendered executory and ordered to be executed, and that the land described therein should be seized and sold to satisfy said judgment.

Upon this judgment a fieri facias was issued, directed to the sheriff of the parish. By virtue thereof he advertised for sale the plantation described in the mortgage, and struck off and sold it to Walter E. Bondurant, and executed to him a deed therefor.

Walter E. Bondurant thereupon brought an action in the United States Circuit Court for the District of Louisiana against Augustus C. Watson, Sen., to recover possession of that part of the plantation which had been sold to him by John Bondurant.

He recovered judgment for the land against Watson. That judgment was taken, by writ of error, to the Supreme Court of the United States, where it was reversed on the sole ground that there had been no actual seizure of the premises by the sheriff before the sale. See Watson v. Bondurant, 21 Wall. 123.

In the mean time Walter E. Bondurant died. The judgment in his favor in the District Court for the Parish of Tensas was revived in the name of his widow, Ella F. Bondurant, his testamentary executrix and the tutrix of his minor son.

At her instance another fieri facias was issued on the judgment of the District Court for the Parish of Tensas, and placed in the hands of the sheriff of that parish. By virtue of the writ he seized that part of the plantation which had been sold to Augustus C. Watson, Sen., and advertised the same for sale. Thereupon Frank Watson, the appellee, on June 25, 1875, filed his petition in the District Court for the Parish of Tensas against the sheriff and Ella F. Bondurant, executrix and tutrix. He averred that his 'immediate author,' Augustus C. Watson, Sen., acquired the land in question by a good and valid title translative of property from John Bondurant, on Nov. 30, 1854; that said Augustus C. Watson, Sen., held said lands by notorious public and uninterrupted possession, in good faith as owner, from Nov. 30, 1854, until Aug. 5, 1872, when he transferred his title and possession, by deed of that date, to the petitioner, Frank Watson, and his brother, A. C. Watson, Jr., and that by deed dated Feb. 6, 1875, A. C. Watson, Jr., conveyed all his estate in said land to the petitioner, Frank Watson.

He further averred that the sheriff of Tensas Parish, acting under a writ of ''alias fi. fa.'' issued on the said judgment recovered by Walter E. Bondurant against Albert, John, and Horace Bondurant in the District Court of said parish, had illegally seized the tract of land which was held and claimed by the petitioner under the deeds of conveyance already mentioned, and would advertise and sell the same, unless restrained by injunction.

The petition further alleged that said act of Dec. 4, 1854, which reserved the mortgage and privilege on said plantation in favor of Walter E. Bondurant for $37,500 had not been reinscribed within ten years from the date of its original registry in the mortgage records, and it had, therefore, ceased to have any force or effect as a mortgage and privilege on said tract of land; that at the time of the institution of the suit of said Walter and others, in which the judgment was recovered by virtue of which said fieri facias was issued, said Augustus C. Watson, Sen., was and for many years previous had been in public possession of said property as owner, yet he was not made a party to said suit, which was via ordinaria, nor were any demands or notices given him as third possessor.

The petition, therefore, claimed that the seizure of the property by the sheriff was illegal, and prayed an injunction against Ella F. Bondurant, executrix and tutrix, and against the sheriff, restraining them from proceeding any further with the said writ of fieri facias, so far as it related to the lands claimed by the petitioner.

The injunction prayed for was granted by the court in which the petition was filed, after notice to the sheriff and Mrs. Bondurant.

Thereupon, on Oct. 18, 1875, Mrs. Bondurant filed her petition, verified by her oath, in which she prayed for a removal of the cause to the United States Circuit Court for the District of Louisiana. In her petition she averred that she was a citizen of the State of Mississippi, and was, in her capacity as tutrix and executrix, defendant in a civil suit pending in that court, in which the matter in dispute exceeded, exclusive of costs, the sum of $500, and in which Frank Watson, who was a citizen of Louisians, was plaintiff.

This petition was accompanied by a bond in the penal sum of $250, conditioned according to law, and executed by the petitioner and two sureties.

The petition for removal was denied by the State court. Nevertheless Mrs. Bondurant, within the time required by law, filed in the United States Circuit Court a transcript of the proceedings of the State court, beginning with the issuing of the fieri facias, which the petition of Watson was filed to enjoin.

The Circuit Court took jurisdiction of the case and directed it to be placed on the equity side of the docket. Thereupon Mrs. Bondurant filed her answer and amended answer, to which the petitioner, Watson, filed his replication. Upon the issue thus made, voluminous proofs were taken, and upon final hearing the Circuit Court made perpetual the injunction which had been granted by the State court. That decree is now here on appeal taken by the defendant, Mrs. Bondurant.

The District Court for the Parish of Tensas, claiming that the cause still remained in that court, notwithstanding the attempt of the defendant to remove it to the United States Circuit Court, proceeded with the cause to final hearing, and also made perpetual the injunction which it had granted. This decree was affirmed on appeal by the Supreme Court of Louisiana. See Watson v. Bondurant, 30 La. Ann. 1, pt. 1.

The defendant brought up that decree also by writ of error to this court.

By agreement of counsel, the records in both cases have been submitted and argued together. Watson, the complainant in both cases, claimed that the suit was not a removable one, and that there was no effectual removal thereof to the Circuit Court, and that the State courts alone had jurisdiction. The defendant denied the jurisdiction of the State court, and insisted that the case was a removable one, and had been removed to the Circuit Court, which thereafter alone had jurisdiction. The case brought here from the State Supreme Court having been dismissed for want of a writ of error (see Bondurant, Tutrix, v. Watson, supra, p. 278), it becomes necessary to decide the question of jurisdiction.

On this question the first contention of Watson, the complainant, is that the petition of Mrs. Bondurant for the removal of the case, which was filed Oct. 18, 1875, does not aver that at the commencement of the suit, which was June 25, 1875, she was a citizen of the State of Mississippi.

Whether, under the act of March 3, 1875, c. 137, to regulate the removal of causes from the State courts, such an averment is necessary, is a question which was expressly reserved by this court in the case of Insurance Company v. Pechner (95 U.S. 183), and which it has never decided. We do not find it necessary to decide it now, for the evidence in the record satisfies us that Mrs. Bondurant was a citizen of Mississippi on June 25, 1875, when the proceeding against her was begun by Watson. Whether the petition avers the fact or not is immaterial, provided the fact is shown to exist by any part of the record. Gold-Washing and Water Company v. Keyes, 96 id. 199; Briges v. Sperry, 95 id. 401; Robertson v. Cease, 97 id. 646.

The record shows that her husband, of whose will she was the executrix, was at the time of his death, and for many years before had been, a citizen of the State of Mississippi, residing at Natchez. She was, therefore, a citizen of Mississippi at the time of her husband's death, which took place before the filing by Watson of the petition in this case, on June 25, 1875. In October, 1875, she swears that she was then a citizen of Mississippi. At and before that time she had been sojourning with her father in New Orleans, but, as the record indicates, her residence there was transient and temporary, and with a purpose, declared at the time, of retaining her citizenship in Mississippi. She could not lose her citizenship in Mississippi without a change of residence animo manendi, and her purpose was better known to herself than to any one else.

The fact that Mrs. Bondurant took out letters testamentary on the will of her husband in the parish of Tensas without giving bond, as she would have been required to do had she been a non-resident of the State, does not, in our judgment, overcome her affidavit that she was a citizen of Mississippi, and the presumption that, having once been a citizen of that State, her citizenship continued. The proceedings in the Probate Court of Tensas Parish were conducted entirely by her attorney, and their details were not necessarily known to her.

We think the fact of her citizenship in Mississippi, at the time of the commencement of Watson's suit against her, sufficiently appears by the record, and this supplies the want of an averment of the fact in her petition for the removal of the case.

The next claim of Watson is, that the suit removed was merely auxiliary and incidental to the original case of Walter E. Bondurant v. Albert Bondurant and Others, and was not, therefore, removable.

In this view we do not concur. The case which was removed had all the elements of a suit in equity. The petition filed in the State court sought equitable relief, which no court strictly a court of law could grant. Citations were issued and served upon the defendants. When the case was transferred to the Circuit Court, it was placed on the equity side of the docket. An answer and a replication were filed, testimony was taken, and a decree made upon final hearing according to the equity practice. The controversy in the original cause between Walter E. Bondurant and Albert Bondurant and others had been ended by a final judgment. The case between Watson and Mrs. Bondurant had its origin in that judgment, but it was a new and independent suit between other parties and upon new issues. It was a suit in which the plaintiff sought to be protected against a judgment, to which he was not a party, by which his property had been specifically condemned to be sold to satisfy a claim against others, and not against him.

He insisted that the mortgage on which the judgment was founded was not a lien on the property claimed by him. To prevent being turned out of possession of his own land, and a cloud being cast on his title by a seizure and sale under the judgment of the State court was the purpose of his suit. It could not be called incidental or auxiliary to the original case. It was a new and independent controversy between other parties. It filled all the requisites of the law for the removal of causes. It was a suit of a civil nature in equity, in which the matter in dispute, exclusive of costs, exceeded the sum or value of $500, and in which there was a controversy between citizens of different States.

No reason is perceived why a party to such a controversy should not enjoy his constitutional right of having his case tried by a court of the United States.

The case of Bank v. Turnbull & Co. (16 Wall. 190), relied on by the appellee, is not in point. That was a statutory proceeding to try in a summary way the title to personal property seized on execution. It was nothing more than a method prescribed by the law to enable the court to direct and control its own process, and, as decided by this court, was merely auxiliary to, and a graft upon, the original action.

It is next claimed that the case was not removable because its purpose was to obtain the writ of injunction to stay proceedings in a State court, which a court of the United States is forbidden to grant by sect. 720 of the Revised Statutes.

It is to be observed that the injunction had already been granted by the State court before the application for removal was made. The interest and purpose of Mrs. Bondurant, who asked for the removal, was to get the injunction dissolved. If Watson had filed his petition for injunction in the State court, and before it was allowed had petitioned for a removal of the cause to the Circuit Court, with the design of applying to that court for his injunction, the objection to the right of removal would have force. That would have been an evasion of the statute. But that is not this case.

The act of March 3, 1875, provides that all injunctions had in the suit before its removal, shall remain in full force and effect until dissolved or modified by the court to which the suit shall be removed. It provides for removals, without making any exception, of cases in which an injunction has already been allowed to stay proceedings in a State court. It would not be according to the well-settled rules of statutory construction to import an exception into this statute from a prior one on a different subject.

We are of opinion, therefore, that the case was one removable under the act of March 3, 1875, and that the Circuit Court obtained jurisdiction by the proceedings for its removal.

The merits of the case have been conclusively settled by the Supreme Court of Louisiana.

Watson, the plaintiff, claimed that the parcel of land conveyed to him by John Bondurant was freed from the lien of the mortgage to Walter Bondurant, by the failure of the latter to have it reinscribed within the ten years from the date of its original registry.

The contention of the defendant, Mrs. Bondurant, is that reinscription was not necessary to preserve the lien of the mortgage on Watson's land, because he was charged with notice by the pact de non alienando contained in the mortgage, and because the mortgagee, Walter E. Bondurant, being a minor, the mortgage to him did not require reinscription to preserve its lien.

These questions have been settled against the appellant by the Supreme Court of Louisiana.

That court has decided that, under the positive law of Louisiana, as contained in the code and statutes, nothing supplies the place of registry, or dispenses with it, so far as those are concerned who are not parties to the mortgage, and that when ten years have elapsed from the date of inscription without reinscription, the mortgage is without effect as to all persons whomsoever who are not parties to the mortgage. Adams & Co. v. Daunis, 29 La. Ann. 315, and cases there cited.

In the case of Watson v. Bondurant (30 La. Ann. 1, pt. 1), the same court held that no mortgage has any effect as to third persons unless recorded; and, save in the single case of a minor's mortgage on the property of his tutor, every mortgage ceases to have effect, except as to the parties to it, unless reinscribed within ten years from the date of its original inscription, and that neither the existence of the pact de non alienando in a mortgage, nor the pendency of a suit to foreclose the same, obviates the necessity of its inscription or reinscription.

The decisions above cited, establishing as they do a rule of real property in the State of Louisiana, are binding on this court, and are conclusive of this case. Suydam v. Williamson, 24 How. 427; Jackson v. Chew, Wheat. 162; Beauregard v. City of New Orleans, 18 How. 497.

The decree of the Circuit Court must, therefore, be affirmed; and it is

So ordered.


text: Talk:Bondurant v. Watson/Opinion of the Court


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Louisiana v. United States (103 U.S. 289)

ERROR to the Circuit Court of the United States for the Eastern District of Missouri.

The facts are stated in the opinion of the court.

Mr. David P. Dyer for the plaintiff in error.

Mr. John D. S. Dryden for the defendant in error.

MR. CHIEF JUSTICE WAITE delivered the opinion of the court.


text: Talk:Louisiana v. United States (103 U.S. 289)


text:
Louisiana v. United States (103 U.S. 289)/Opinion of the Court

The following are sects. 2 and 13 of art. 3 of the charter of the city of Louisiana, Mo.:--

'SECT. 2. The city council shall have power within the city     by ordinance: First, to levy and collect taxes not exceeding      one and one-half of one per centum per annum upon all      property made taxable by law for State purposes, and to      provide for the collection of the same by sale of real and      personal estate in such manner as the council may, by      ordinance, provide.'

'SECT. 13. The council shall not fix or reduce the rate of     taxation to less than one and one-half of one per centum per      annum until two-thirds of such reduced rates of taxation      shall be sufficient, including all sources of revenue, to      meet and pay all accruing interest for the year affected by      such reduction, without increasing the principal of the      debt.'

Sect. 23, art. 7, provides that--

'If at any time the city council shall fail to make suitable     provisions for the payment in whole or in part of any of its      debts or liabilities contracted after the passage of this      act, or heretofore lawfully contracted, for the term of      twelve months after such debt or liability shall have become      due and demand for payment made, it shall then be lawful for      the Circuit Court or Court of Common Pleas, before which      judgment of any such debt or liability shall have been      obtained to make and enter up any such orders, decrees, and      appointments as may be necessary for the levying, assessing,      and collecting taxes in the city not exceeding one per centum      per annum until such debt or liability shall be fully paid      and discharged by the city authorities. The amount so     collected to be applied, under the decree of the court,      strictly to the payment of such debt or judgment.'

Sects. 2415 and 2416 of the Revised Statutes of the State are as follows:--

'SECT. 2415. Whenever an execution issued out of any court of     record in this State against an incorporated town or city      shall be returned unsatisfied in whole or in part for want of      property whereon to levy, such court, at the return term or      any subsequent term thereof, may, by writ of mandamus, order      and compel the chief officer, trustees, council, and all      other proper officers of said city or town, to levy, assess,      and collect a special tax to pay such execution and all      costs.' 'SECT. 2416. The court shall determine the time within which     the levy and collection of such tax shall be made, and shall      make all necessary orders to secure the prompt and speedy      payment of such debt.'

Wood, having recovered a judgment against the city in the Circuit Court of the United States for the Eastern District of Missouri, for $22,226.40, which had remained unpaid for more than twelve months, and on which an execution had been returned turned unsatisfied, the United States on his relation asked the court for a writ of mandamus to compel the levy and collection of a special tax for its payment. The city in defence claimed that it could not under its charter be required to levy such a tax, because it had already levied the full amount allowed by sect. 2, art 3, and there were other judgments (enumerating them) against it amounting with this to more than $100,000, while its taxable property was only $907,200.

Upon the trial of the cause several questions arose which resolved themselves into the following: 1, Whether the city could under the circumstances of this case be required to levy taxes in any one year for more than one and one-half of one per cent on the value of the taxable property within its jurisdiction; and, 2, if it could, whether the additional amount could exceed one per cent for all creditors having special judgments or contract rights. Upon these questions the judges of the court were divided in opinion, and they certified that fact here. The presiding judge, however, was of the opinion that the relator was entitled to a peremptory writ of mandamus requiring the levy and collection of a special tax sufficient to raise and pay $9,000 a year on his debt until it with the costs was fully satisfied, and a judgment was rendered accordingly. To reverse that judgment the case has been brought here by writ of error.

We are entirely satisfied that the view which the circuit judge took of the case was right, and that the judgment should be affirmed. The tax referred to in sect. 2, art. 3, of the charter is evidently the ordinary tax which the necessities of the city demand, and before anything more can be required, a case must be made for relief under sect. 23, art. 7, of the charter, or sects. 2415 and 2416 of the Revised Statutes, which are the same as sects. 77 and 78, c. 160, of the General Statutes of 1865, p. 650. There cannot be a doubt that the General Statutes embrace this city. They in express terms apply to all incorporated towns and cities. Whether, so far as this city is concerned, the discretionary power vested in the court is limited to a tax of one per cent for each judgment obtained, is a question we need not decide, for in this case that limit has not been exceeded. The taxable value of the property in the city is over $900,000, and the tax each year for this judgment is limited to $9,000. We are, however, entirely clear that under the charter it is within the power of the court to carry the tax up to full one per cent for each debt on account of which such special relief is asked. Both the Revised Statutes and this particular section of the charter contemplate judgments against the city which cannot be collected by execution. In such a case permission is given to apply to the court in which the judgment has been rendered for special relief, or perhaps more properly a special order on the city to make provision for payment. What that provision shall be is left largely to the court to determine under the particular circumstances of each case, with a view to securing the prompt and speedy payment of the debt; but the money, when collected, must be applied strictly to the payment of the particular debt for which the special direction is given. Each tax must be levied and kept separate, but the amount to be levied in a particular case may be made dependent somewhat on other levies for other judgments or debts made payable at the same time. All such questions are with propriety left to the sound judicial discretion of the court, with a view to the prompt and speedy discharge of all the obligations of the city, without unnecessarily oppressing the taxpayers. The corporate authorities are fully empowered to tax to the extent of one and one-half per cent, and should do so if necessary; but if more is required in any particular case, resort must be had to the courts. The city authorities must in all cases make provision to pay all debts at maturity, if they have the power under the law; but if their powers are too much limited to enable them to do so, then the creditors have been given a special remedy on appeal to the courts. The effect of the several statutes is to limit the ordinary powers of the municipality for taxation, but to give the courts ample authority, when a judgment has been obtained, to enforce execution by requiring the levy at a proper time, of a sufficient tax to meet the judgment. A mandamus in such a case is in the nature of an execution to collect the judgment.

Judgment affirmed.


text: Talk:Louisiana v. United States (103 U.S. 289)/Opinion of the Court


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Barbour v. Priest

APPEAL from the Circuit Court of the United States for the Northern District of Ohio.

The facts are stated in the opinion of the court.

Mr. A. K. Dunn for the appellants.

Mr. N. N. Leyman, contra.

MR. JUSTICE MILLER delivered the opinion of the court.

title: Barbour v. Priest


text: Talk:Barbour v. Priest

title: Talk:Barbour v. Priest


text:
Barbour v. Priest/Opinion of the Court

The appellee brought his bill in chancery in the District Court for the Northern District of Ohio, as assignee in bankruptcy of Hubbard Colby, to set aside and avoid two mortgages, made to appellant a short time before proceedings were commenced against Colby as a bankrupt. The District Court rendered a decree against the assignee, which was reversed on appeal to the Circuit Court, the latter holding the mortgages void under the bankrupt law. From that decree this appeal is taken.

Mrs. Barbour was the widow of Justus S. Barbour, and guardian of his minor children, and Colby, the bankrupt, was administrator of said Barbour's estate. He was the brother-in-law of Mrs. Barbour, whose husband had been dead many years; and Colby, after administering the estate, had retained in his hands about $24,000, which he had never paid over to her, as he should have done.

Colby was a man of reputed wealth and the owner of much valuable real estate, and it is obvious from the testimony that Mrs. Barbour reposed unlimited confidence in him, and relied on him for the general management of the estate. On the eleventh day of June, 1873, Mrs. Barbour received a notice from the probate judge to make a settlement, showing the condition of her accounts as guardian, and to file a new bond. She filed a new bond, but did not make the settlement. On September 20, of the same year, she received another notice, requesting her to file a statement of her account the next day. She swears in her testimony that she handed both these notices to Mr. Colby, and requested him to attend to the affair, and that she relied on him entirely in the matter. On the first day of October, Colby made two mortgages on distinct parcels of real estate, for the purpose of securing his indebtedness to Melissa A. Barbour, in her right as widow, and as guardian of the minor children of her husband, in the sum of $22,722.20, then in his hands, as administrator of the estate of Justus Barbour.

Colby was adjudicated a bankrupt on a petition filed Nov. 3, 1873.

The testimony on which the decree was rendered is very voluminous, and need not be critically examined here. We think three propositions of fact are so clearly established that there can be little doubt about them. They are:--

1. That when Colby made the mortgages to Mrs. Barbour he was insolvent, and knew he was in that condition.

2. That he intended by those mortgages to give Mrs. Barbour a preference over his other creditors, by securing the debt due her and her children from him, as administrator of Barbour's estate.

3. That Mrs. Barbour did not know, nor have reasonable cause to believe, that Colby was insolvent when the mortgages were made and filed for record.

It will be perceived that the conveyances which are here in question were made, and the proceedings in bankruptcy were commenced against Colby, before the date at which the Revised Statutes became the law, and before the act of 1874, amendatory of the bankrupt law, was passed. The validity of these mortgages, then, so far as they are affected by the bankrupt laws of the United States, is to be determined by sect. 35 of the original act of March 2, 1867, c. 176, 14 Stat. 534. So much of that section as relates to the question before us reads as follows:--

'SECT. 35. And be it further enacted, that if any person     being insolvent, or in contemplation of insolvency, within      four months before the filing of the petition by or against      him, with a view to give a preference to any creditor or      person having a claim against him, or who is under any      liability for him, procures any part of his property to be      attached, sequestered, or seized on execution, or makes any      payment, pledge, assignment, transfer, or conveyance, of any      part of his property, either directly or indirectly,      absolutely or conditionally, the person receiving such      payment, pledge, assignment, transfer, or conveyance, or to      be benefited thereby, or by such attachment, having      reasonable cause to believe such person is insolvent, and      that such attachment, payment, pledge, assignment, or      conveyance is made in fraud of the provisions of this act,      the same shall be void, and the assignee may recover the      property, or the value of it, from the person so receiving      it, or so to be benefited.'

The act of making these mortgages by Colby, though he knew that he was insolvent, and knew that he was preferring Mrs. Barbour as a creditor at the expense of others, is not forbidden by the common law, and is not a violation of the statute laws of most of the States of the Union. Nor is it an act for bidden by any general rule of morals or of abstract justice. It was in fact a meritorious act, aside from the positive rule established by the bankrupt law. He had long had this money of a confiding widowed sister-in-law and her orphan children, and while holding it in a fiduciary capacity he had used it for his own purposes. He saw her called to account for it by the Probate Court, and knew he was unable to refund it. He also saw the gulf of bankruptcy before him, and before he was buried beneath its waters he determined at least to secure this debt,-the creation of a trust reposed in him. Who shall arraign him for it in the court of conscience?

If, then, it was forbidden neither by the common law, nor by the statute of the State, nor by the highest sense of honor, it must be made to appear clearly that it is void under the section of the bankrupt law which we have quoted, or else it must stand.

It is a fundamental condition of the right of the assignee to avoid such a conveyance, that the person receiving it, or to be benefited thereby, should have had reasonable cause to believe that the person making such conveyance was insolvent, and that it was made in fraud of the Bankrupt Act.

The obvious meaning of this provision is to require the concurrence of the creditor who gets security for his debt in the purpose of defeating the Bankrupt Act. Such person must have reasonable cause to believe the grantor in the conveyance was insolvent at the time it was executed, and that it was made with intent to defeat the bankrupt law. Both these must exist as facts which the grantee had reasonable cause to believe. And so careful was Congress to protect the rights acquired by an honest creditor, that unless bankrupt proceedings are commenced by or against the debtor within four months after such a preference, it should stand good, though the creditor knew the debtor was insolvent, and knew that the conveyance was intended to defeat the purpose of the bankrupt law in securing equality of distribution of the debtor's property. And this period was reduced by the act of 1874 to two months.

It has never been denied, so far as we are advised, that it is necessary for the assignee of the bankrupt, in attacking such a conveyance, to prove the existence of this reasonable cause of belief of the debtor's insolvency in the mind of the preferred party.

The testimony fails to establish that Mrs. Barbour had any reasonable cause to believe this of Colby. She was a widow, devoted to her children. Her business affairs were managed for her by others. Colby was her brother-in-law and friend, and had been the friend of her deceased husband. He had been reputed for many years to be a wealthy man. He was known to be the owner of valuable real estate. All this was well understood by Mrs. Barbour, while she did not know, and had no reason to suspect, that he was largely in debt, and his real estate covered by mortgages. Up to the time of the failure of the First National Bank of Mansfield, Sept. 26, 1873, very few persons had any doubt of Colby's entire solvency. The rapid succession of events in the locality where he and Mrs. Barbour resided, and their influence upon his condition, as described by some of the witnesses, might well have been matters of which she was ignorant. She swears that she was not aware of the effect of these matters on him, and no one is able to say that she had any reason to be. Nothing was brought to her notice or attention which would suggest a suspicion of his insolvency, and her confidence in him was clearly not shaken.

In Grant v. National Bank (97 U.S. 80) this court said:

'The act very wisely, as we think, instead of making a payment or a security void for a mere suspicion of the debtor's insolvency, requires for that purpose, that his creditor should have some reasonable cause to believe him insolvent. He must have knowledge of some fact or facts calculated to produce such a belief in the mind of an ordinarily intelligent man.' p. 82. Tested by this rule, which, we think, is the sound one, there is no evidence of any such knowledge brought home to Mrs. Barbour. In fact, we do not believe that at the time the deeds were executed she even suspected Colby's insolvency or contemplated his failure.

It results from this view of the case that the decree of the Circuit Court must be reversed, and a decree rendered establishing the validity of the mortgages to her and adjusting the rights of the parties on that basis.

So ordered.

title: Barbour v. Priest/Opinion of the Court


text: Talk:Barbour v. Priest/Opinion of the Court


text:
The Illinois

SPPEAL from the Circuit Court of the United States for the Eastern District of Pennsylvania.

The facts are stated in the opinion of the court.

Mr. J. Warren Coulston for the appellant.

Mr. Morton P. Henry, contra.

MR. CHIEF JUSTICE WAITE delivered the opinion of the court.

title: The Illinois


text: Talk:The Illinois

title: Talk:The Illinois


text:
The Illinois/Opinion of the Court

This is a case of collision in the Delaware Bay, and the facts found are substantially as follows: The 'Illinois' was a large steamship, three hundred and sixty feet in length, and of three thousand tons register. She was going up the bay at a speed of ten knots an hour. She had just rounded Dan Baker's shoal on a port wheel, and had got straightened on her course in about mid-channel. The schooner 'Ellen Baker' was ahead of her, a little on the port bow, and bound for New Castle, Del. The wind was from the northeastward, and the schooner was by the wind, heading about north-by-west, or north-northwest, and pointing for Reedy Island piers. The vessels were on slightly diverging lines which were about one hundred yards apart. The western or Reedy Island side of the bay was obstructed by ice, while the eastern side was open. When the vessels were probably three or four hundred yards apart, the schooner went in stays and then tacked to the eastward to avoid the ice, which was ahead of and close under her port bow. There was no lookout astern on the schooner, and, until she had changed her course, no one on board had observed the steamer. The steamer had a sufficient lookout. Her master and pilot were on the bridge looking ahead, and they saw the schooner before she tacked. They so directed the steamer's course as to pass the schooner in safety on her starboard side, three hundred feet or thereabouts away, if she kept the course she was on. As soon as the manoeuvre of the schooner was seen on the steamer, orders were given to put the helm hard-a-starboard, to stop the engine, then to back at full speed, and to let go the anchor, with a view to passing under the schooner's stern. These orders were ineffectual to prevent a collision, and the steamer struck the schooner just abaft the main rigging, causing her to capsize and sink.

It seems to us the court below was right, on these facts, in holding the steamer free from blame. The responsibility of avoiding a collision with a sailing-vessel is put by the act of Congress and the sailing rules primarily on a steamer. But the sailing-vessel is under just the same responsibility to keep her course, if she can, and not embarrass the steamer, while passing, by any new movement. A steamer has the right to rely on this as an imperative rule for a sailing-vessel, and govern herself accordingly. Otherwise it would at times be impossible for a steamer to get ahead at all in the thoroughfares of navigation.

In the present case the steamer was in mid-channel. That was the proper place for a vessel of her size, and, under the circumstances, we cannot say her speed was unusual, since, so far as appears, there were no other vessels in the way. Had the schooner kept her course for a minute or two longer, there is scarcely a doubt that the steamer would have got by in safety. It was clearly a fault, therefore, for her to change her course, unless there was a necessity for it. Mere convenience was not enough. The schooner in this court has the affirmative. It rests on her to show error in the decree of the court below, or we must affirm.

It is an important fact that the steamer was not observed from the schooner before the course was changed. While a man stationed at the stern as a lookout is not at all times necessary, no vessel should change her course materially without having first made such an observation in all directions as will enable her to know how what she is about to do will affect others in her immediated vicinity. In the present case, it is not found expressly that the ice was so close under the port bow of the schooner as to make it dangerous for her to keep on as she was going until the steamer got by. She ought to have known that although the ice was an obstruction on the west side of the bay, she was not far from the place in the channel through which the large steamers which navigated there would be likely to pass if following her. It is not found that there was anything in view from the steamer to indicate to her the necessity for any early change of the course of the schooner. So far as the findings show, the way was open for some distance ahead, and the steamer had the right to assume she might keep her place in mid-channel and go on with safety. We must also infer from what is actually found, as well as from what is not found, that if the schooner had known the circumstances in which she was placed, her change of course would have been delayed until it might be made without danger. Because a steamer must keep out of the way of a sailing-vessel, it by no means follows that a sailing-vessel may unnecessarily throw herself across the bow of an approaching steamer. It is as much the duty of a sailing-vessel to be diligent in the performance of her duty as it is that of a steamer to be mindful of hers. In the case of The Abbotsford (98 U.S. 440), it was distinctly found that the tack of the schooner was entirely proper, both for her own safety and in regard to the steamer. She had run out her course, and the steamer, which was yet a considerable distance away, ought to have known it. Consequently the steamer was in fault for getting so close as to put herself in the way of the schooner while doing what the necessities of the navigation actually required, and which a prudent and skilful navigator on the steamer ought to have known she must do at the time it was done. Such is not shown to have been the case here.

Decree affirmed.

title: The Illinois/Opinion of the Court


text: Talk:The Illinois/Opinion of the Court

title: Talk:The Illinois/Opinion of the Court


text:
Moyer v. Dewey

ERROR to the Court of Appeals of the State of New York.

The facts are stated in the opinion of the court.

Mr. Samuel Hand and Mr. Matthew Hale for the plaintiffs in error.

Mr. James E. Dewey, contra.

MR. JUSTICE MILLER delivered the opinion of the court.

title: Moyer v. Dewey


text: Talk:Moyer v. Dewey

title: Talk:Moyer v. Dewey


text:
Moyer v. Dewey/Opinion of the Court

The complaint filed by the defendants in error in the Supreme Court of the State is in the nature of a bill in chancery against the plaintiffs in error and Clinton Eldredge. It charges that the complainants severally recovered judgments in the proper courts against said Eldredge, on which executions were issued and returned nulla bona. It then charges, giving the details of the transaction, that the defendants held certain real estate, the title of which was conveyed to them by Eldredge, without consideration and with intent to defraud his creditors. The defendants answer separately and deny the fraud. They also attempt to protect themselves under the discharge of Eldredge in bankruptcy, and as the only question cognizable in this court turns upon this part of the defence, which is more fully set up in the answer of Betsey Moyer than in that of Henry, so much of the answer as refers to this matter is here given verbatim:--

'And the said defendant, upon her information and belief, alleges that on or about the seventeenth day of August, 1868, at Buffalo, in the State of New York, the United States District Court held in and for the Northern District of the State of New York duly made an order and a decree discharging the defendant Clinton Eldredge of and from all his debts, of all of which proceedings in the said court in bankruptcy for such discharge the said plaintiffs and their said assignors, and each of them, had due notice; that the pretended indebtedness, if any such existed or ever did accrue, accrued prior to the filing of the petition of the said Clinton Eldredge for his discharge from such debts in the said United States District Court, and prior to the granting of such discharge, and that the said indebtedness and the said several claims, if any such exist or ever existed, were such as were provable against the estate of the defendant Clinton Eldredge in the proceedings in which said discharge was granted, and were not, nor was any part thereof, created in consequence of any defalcation as a public officer, or as an executor, administrator, guardian, or trustee, or while acting in any other fiduciary capacity, and he is, therefore, discharged therefrom, and from all liability thereon, and the said plaintiffs are precluded and debarred from enforcing or attempting to enforce the same.'

It will be observed that nothing is here said of an assignee in bankruptcy, nor of the right of the assignee, if one existed, to the property conveyed by Eldredge to the defendants in fraud of his creditors. The obvious purpose of this plea is to show that Eldredge's debts to the plaintiffs were discharged, and that they could not, therefore, maintain this suit on such indebtedness. Nor does it appear in any part of the record that the assignee's rights were considered by either the plaintiffs or the defendants, nor was he made a party to the suit.

The case was sent, under the practice of the New York courts, to a referee, and on his report a judgment was rendered in favor of the plaintiffs, which was affirmed in the Court of Appeals. With the general question of fraud in the matter this court can have nothing to do. It appears by the report of the referee that the transaction was fraudulent as charged. It also appears that the judgments against Eldredge set up as the foundation of this suit, although founded on debts existing prior to his discharge in bankruptcy, were confessed by him subsequently thereto, and that, though a defendant in this suit, he, by failing to answer, waives the benefit of the discharge. Under these circumstances, we concur with the opinion of the Court of Appeals, that so far as the discharge itself is concerned, its only effect is personal to him, and does not avail to release the defendants in this suit from liability for the fraud committed by them.

But we have decided at this term, in Trimble v. Woodhead (102 U.S. 647), in a case very similar in some of its aspects to this, that the right to bring such an action as this-the right to the property so fraudulently conveyed-is vested in the assignee alone, and that his failure to sue within the two years allowed by the bankrupt law does not transfer this right of property or right of action to a creditor of the bankrupt.

If, therefore, in the present case it had been made to appear by the record properly before the Court of Appeals that an assignee had been appointed, and he had properly qualified and accepted such appointment, we do not see how the plaintiffs could have recovered judgment for the value of the property.

The Court of Appeals of New York take the ground, in their opinion, distinctly, that neither the appointment of an assignee in bankruptcy, nor the existence of any rights in such assignee, nor any defence having reference to such rights, is set up in the answer. And in this opinion we concur.

When the case went to the referee the defendants offered certified transcripts of the proceedings in the District Court, which showed the appointment of the assignee, the assignment to him made by the register, and the discharge of Eldredge. The plaintiffs objected to the admission of these papers in evidence, on the ground that they were not set up in the answer, either according to the statute or in pursuance of the common-law rule.

The referee, while he admitted the papers in evidence, did not, among his finding of facts, which were thirty-four in number, find that the assignee had been appointed, or an act of appointment made by the register. He did, however, find that Eldredge had been duly discharged of his debts. It is probable that he received the transcript objected to as evidence of the validity of Eldredge's discharge, but not as evidence of the assignment, which was not set out in the pleading.

The question whether the assignment, and the rights of the assignee under it, were so set up in the answer as to admit the evidence of them, or whether, on the other hand, the defendants relying, as they seem to have done, solely on the principle that Eldredge's discharge inured to the benefit of the defendants, can now avail themselves of the transcripts, is one dependent very largely on the practice of the courts of the State. The Court of Appeals rests its decision on the ground that the pleading does not set out or rely on the assignment or on the rights vested by it in the assignee, and it says very justly, that if any such issue had been made, the plaintiffs might have had a sufficient reply, which they were not called on to produce as the pleadings stand.

We concur with that court in holding that the existence of an assignee, or of any right of such assignee to the property or the claims asserted in this suit, is not raised by this record.

Judgment affirmed.

title: Moyer v. Dewey/Opinion of the Court


text: Talk:Moyer v. Dewey/Opinion of the Court


text:
Miles v. United States

ERROR to the Supreme Court of the Territory of Utah.

The facts are stated in the opinion of the court.

Mr. Arthur Brown, Mr. W. N. Dusenberry, and Mr. E. D. Hoge for the plaintiff in error.

Mr. Assistant Attorney-General Smith, contra.

MR. JUSTICE WOODS delivered the opinion of the court. Sect. 5352 of the Revised Statutes of the United States declares:--

title: Miles v. United States


text: Talk:Miles v. United States

title: Talk:Miles v. United States