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Liverpool Insurance Company v. Massachusetts

ERROR to the Supreme Judicial Court of Massachusetts; the case being this:

A statute of the State just named imposes upon 'each fire, marine, and fire and marine insurance company, incorporated or associated under the laws of any government or State other than one of the United States, a tax of 4 per cent. upon all premiums charged or received on contracts made in this commonwealth for insurance of property.' The same statute imposes a tax of but 2 per cent. upon such premiums when the company is incorporated under the laws of any one of the United States other than Massachusetts; upon which premiums, where the company is incorporated by itself, it imposes but 1 per cent.; while no tax is imposed by the laws of the State upon the business of insurances transacted by any natural persons citizens of the same.

With the enactment just mentioned on its statute-book, the State of Massachusetts, in 1868, filed a bill in its Supreme Judicial Court against the Liverpool and London Life and Fire Insurance Company (a company doing a large business in that State), to collect a tax of 4 per cent. on its premiums upon contracts made in Massachusetts for insurance of property, and to restrain the company from doing further business till the tax was paid. The company set up that it was not 'incorporated' at all, but was an association, under the laws of Great Britain, of natural persons, some of whom were citizens and residents of the country just named; and some citizens and residents of the State of New York; formed for the purpose of conducting the business of insurance under certain deeds of settlement, and having the legal character of a partnership; that accordingly it could not be taxed as a 'company incorporated under the laws of any government or State other than one of the United States;' while, in so far as the discriminating tax of 4 per cent. was sought to be laid against it as a company associated simply and not incorporated, it violated, in regard to the members of the company who were subjects of Great Britain, a provision in the treaty of 1815, between that country and the United States, by which it is agreed that the merchants and traders of each nation respectively shall enjoy the most complete protection and security for their commerce; and-in regard to the citizens of New York, that provision in section 2, article 4, of the Federal Constitution which secures to the citizens of each State all the privileges and immunities of citizens in the several States.

Of course, if the company was a corporation, the defence failed: and it not being denied that the persons composing the company were British subjects, with certain citizens of New York with rights like theirs, the first question-and the only one if it was resolved affirmatively-was whether the company was a corporation or not.

The company had been originally formed, in May, 1836, in Liverpool, by a 'deed of settlement.'

This instrument, as far as it could be done without the aid of Parliament, established a company under the name of 'The Liverpool Life and Fire Insurance Company,' with a capital of 2,000,000 sterling, which was divided into 100,000 shares of 20 each, and declared its purpose to be making insurance on life and against fire. These shares could be sold and transferred, and executors and administrators represented them in the company on the death of the owner. If, by the laws of the association, a share became forfeited, the owner was released from all further liability to the company. The business of the company was to be conducted by a board of directors exclusively, and they could make by-laws and change and modify them. There was a covenant that suits might be brought by or against the company in the names of one or more directors, which should bind the stockholders, and that no stockholder would plead in abatement the nonjoinder of the others; and it was further covenanted that a judgment so obtained against a director might be made out of the property of any of the stockholders. Numerous other provisions were found in the original articles, which consisted of over a hundred sections, but only those are referred to here which bear on the question which the court had before it. There were also three subsequent deeds of settlement, and three acts of Parliament were passed to give efficiency to the purposes of the association.

The first of these acts provided that the association might sue and be sued in the name of the chairman or deputy chairman of the board of directors; that the stockholders might sue the company as plaintiffs, or be sued by it as defendants. It regulated the manner in which the shareholders might be made individually liable for the debts of the association; and it declared that the act should not be construed to incorporate the company or relieve its members from their individual liability, except as provided in the act.

The second act of Parliament changed the name of the company to that which it now bears, and authorized it to make contracts by the new name, and it also contained a provision that the act should not make the company a corporation; and there was a third act which authorized amalgamation with another company, and which again provides against its being construed into an act of incorporation or a limited liability partnership.

The Supreme Judicial Court of Massachusetts gave a decree against the company, and enjoined it from the further prosecution of its business till the taxes found to be due were paid.

The case was now brought to this court on the ground that in its application to the company the statute of Massachusetts was in conflict with the provision of the Constitution, which confers on Congress the right to regulate commerce with foreign nations and among the States, and with that which secures to the citizens of each State all the privileges and immunities of citizens in the several States.

Messrs. B. R. Curtis and J. G. Abbott, for the company, plaintiff in error:

Whatever may be the character of the defendants, their association together and their relations to others, they must depend upon the laws of Great Britain. If the defendants are not a corporation by the English law, then they are not by our law, because here they have done no act in any way to alter or change their legal status or their relations to others. Indeed, our law does not in any way apply to them, act upon or affect their character, or profess to do it; it leaves that to be defined by the laws of the country under which they formed their association.

Now, under the laws of Great Britain, it cannot be maintained that the defendants are a corporation, or in fact anything more than a partnership of a large number of natural persons, having procured certain privileges from the government, under which they associated together for the convenience of those who deal with them.

In Great Britain, the King and Parliament alone can create corporations. In this case, neither has exercised the power, but when Parliament granted to the company certain privileges, especial care was taken to declare that the grant made should not create a corporation. This seems conclusive.

With us the defendants would not possess and enjoy the privilege, or be subject to the liability of being sued, and suing in the name of an officer of their association, but would be obliged to sue or be sued in the name of all partners, for the acts of Parliament giving that right and imposing that liability, apply to the manner of enforcing a remedy, and cannot avail beyond its own limits and courts.

So that when the defendants transact their business in this country, the acts of Parliament, giving some of the privileges of corporations, are of no avail to them; in fact they are like any partnership of natural persons, and must be treated in the same way, entitled to the same rights and privileges, and subject to the same liabilities.

Numerous cases in the English Reports where the rights, privileges, and liabilities of such bodies as this one are passed upon, show that the association here is not a corporation.

But if the defendants were an association of our own citizens, formed here under like deeds of settlement, and like acts of the legislature, they would not be held to be corporations. The association does not make out of its members a new artificial political person; it still remains a body of natural persons, with certain privileges conferred upon them. No new body is created by the legislature with the property of individuality, and the capacity of holding property and transacting business. Indeed, the association falls entirely short of being a corporation, as usually defined and understood.

Nor does this case fall within a principle often acted upon by courts, that when a collective body of natural persons are granted powers, rights, and privileges by a collective name, and there is no mode in which they can be enjoyed and exercised, without acting in a corporate capacity, such a body is held to be a corporation by necessary implication. Here, such implication is precluded by the legislative declaration that a corporation shall not exist, and by the fact that the deeds and legislative acts very minutely and carefully provide in what manner the rights and powers granted shall be enjoyed and exercised. Indeed, it is always holden, that where a corporation is so established by implication, the legislative intention to confer a corporate existence must be certain and plain.

Assuming that the plaintiff in error was not a corporation, but was, as they above argued, a partnership or association of individuals, some of which were subjects of Great Britain and others citizens of the State of New York, the learned counsel argued further that the rights of the former were protected by the treaty between the United States and Great Britain, and the rights of the latter by section 2, article 4, of the Federal Constitution referred to in the statement of the case.

Mr. Charles Allen, Attorney-General of Massachusetts, contra:

It is true, that the various acts of Parliament conferring corporate privileges upon the plaintiffs in error declare that it is not the intention thereby to constitute them a corporation; and if merely saying that they are not to be a corporation, at the same time when all the essential qualities and privileges of a corporation are bestowed upon them, would make it that they are not in fact a corporation, then it would have to be admitted that they are not a corporation. But in ascertaining the legal character of the company, we are not to look at what they are called, but at what they are.

By what rule is the question to be tested? The essential characteristics of a corporation are not the same at different times and in different countries. The definitions of a corporation vary. Certain things were formerly deemed essential qualities of a corporation, which are so no longer. Thus, a common seal formerly had essential significance, in those days when it was considered that corporations could only act by deed; but now, in this country, the common seal is of no significance. It is a mere ornament, and without use.

The deeds of settlement of the company show that they strained all laws applicable to partnerships to the very utmost, in the endeavor to provide for the transaction of their business before applying to Parliament for corporate privileges. This company by their deeds of settlement, in fact, made provisions and took upon themselves powers which are inconsistent with the common law applicable to partnerships.

For instance, carrying on business by means of directors exclusively, and depriving the members of all voice in determining matters. This is one. But it was in vain, with the aid of all the provisions that were contained in the deed of settlement, or that could be included in a private agreement among individuals, to attempt to stretch the law of partnerships far enough to cover the business of this company.

Accordingly acts of Parliament were obtained, which gave them in direct terms the various powers; and among these, that they might sue and be sued in the name of one individual; that the company might sue and be used by members of the company; that an amalgamation with another company should be binding on all of their members, whether consenting or not.

After these acts this company lacked no quality or characteristic of a corporation.

The exemption from individual liability is not now (however it may have been heretofore) a characteristic test of a corporation.

[Mr. Allen then replied (though he considered that the court would not get so far as to these points) to the arguments as to rights of the British stockholders under the treaty with Great Britain and of those of New York under the Federal Constitution.]

Mr. Justice MILLER delivered the opinion of the court.


text: Talk:Liverpool Insurance Company v. Massachusetts

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


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Liverpool Insurance Company v. Massachusetts/Opinion of the Court

The case of Paul v. Virginia, #fn-s-s-s decided that the business of insurance, as ordinarily conducted, was not commerce, and that a corporation of one State, having an agency by which it conducted that business in another State, was not engaged in commerce between the States.

It was also held in that case that a corporation was not a citizen within the meaning of that clause of the Constitution, which declares that the citizens of each State shall be entitled to all the privileges and immunities of citizens in the several States, and that a corporation created by a State could exercise none of the functions or privileges conferred by its charter in any other State of the Union, except by the comity and consent of the latter.

These propositions dispose of the case before us, if plaintiff is a foreign corporation, and was, as such, conducting business in the State of Massachusetts, and we proceed to inquire into its character in this regard.

The institution now known as the Liverpool and London Life and Fire Insurance Company, doing an immense business in England and in this country, was first organized at Liverpool by what is there called a deed of settlement, and would here be called articles of association.

It will be seen by reference to the powers of the association, as organized under the deed of settlement, legalized and enlarged by the acts of Parliament, that it possesses many, if not all, the attributes generally found in corporations for pecuniary profit which are deemed essential to their corporate character.

1. It has a distinctive and artificial name by which it can make contracts.

2. It has a statutory provision by which it can sue and be sued in the name of one of its officers as the representative of the whole body, which is bound by the judgment rendered in such suit.

3. It has provision for perpetual succession by the transfer and transmission of the shares of its capital stock, whereby new members are introduced in place of those who die or sell out.

4. Its existence as an entity apart from the shareholders is recognized by the act of Parliament which enables it to sue its shareholders and be sued by them.

The subject of the powers, duties, rights, and liabilities of corporations, their essential nature and character, and their relation to the business transactions of the community, have undergone a change in this country within the last half century, the importance of which can hardly be over-estimated.

They have entered so extensively into the business of the country, the most important part of which is carried on by them, as banking companies, railroad companies, express companies, telegraph companies, insurance companies, &c., and the demand for the use of corporate powers in combining the capital and the energy required to conduct these large operations is so imperative, that both by statute, and by the tendency of the courts to meet the requirements of these public necessities, the law of corporations has been so modified, liberalized, and enlarged, as to constitute a branch of jurisprudence with a code of its own, due mainly to very recent times. To attempt, therefore, to define a corporation, or limit its powers by the rules which prevailed when they were rarely created for any other than municipal purposes, and generally by royal charter, is impossible in this country and at this time.

Most of the States of the Union have general laws by which persons associating themselves together, as the shareholders in this company have done, become a corporation.

The banking business of the States of the Union is now conducted chiefly by corporations organized under a general law of Congress, and it is believed that in all the States the articles of association of this company would, if adopted with the usual formalities, constitute it a corporation under their general laws, or it would become so by such legislative ratification as is given by the acts of Parliament we have mentioned.

To this view it is objected that the association is nothing but a partnership, because its members are liable individually for the debts of the company. But however the law on this subject may be held in England, it is quite certain that the principle of personal liability of the shareholders attaches to a very large proportion of the corporations of this country, and it is a principle which has warm advocates for its universal application when the organization is for pecuniary gain.

So also it is said that the fact that there is no provision either in the deed of settlement or the act of Parliament for the company suing or being sued in its artificial name forbids the corporate idea. But we see no real distinction in this respect between an act of Parliament, which authorized suits in the name of the Liverpool and London Fire and Life Insurance Company, and that which authorized suit against that company in the name of its principal officer. If it can contract in the artificial name and sue and be sued in the name of its officers on those contracts, it is in effect the same, for process would have to be served on some such officer even if the suit were in the artificial name.

It is also urged that the several acts of Parliament we have mentioned expressly declare that they shall not be held to constitute the body a corporation.

But whatever may be the effect of such a declaration in the courts of that country, it cannot alter the essential nature of a corporation or prevent the courts of another jurisdiction from inquiring into its true character, whenever that may come in issue. It appears to have been the policy of the English law to attach certain consequences to incorporated bodies, which rendered it desirable that such associations as these should not become technically corporations. Among these, it would seem from the provisions of these acts, is the exemption from individual liability of the shareholder for the contracts of the corporation. Such local policy can have no place here in determining whether an association, whose powers are ascertained and its privileges conferred by law, is an incorporated body.

The question before us is whether an association, such as the one we are considering, in attempting to carry on its business in a manner which requires corporate powers under legislative sanction, can claim, in a jurisdiction foreign to the one which gave those powers, that it is only a partnership of individuals.

We have no hesitation in holding that, as the law of corporations is understood in this country, the association is a corporation, and that the law of Massachusetts, which only permits it to exercise its corporate function in that State on the condition of payment of a specific tax, is no violation of the Federal Constitution or of any treaty protected by said Constitution.

Whilst I agree in the result which the court has reached, I differ from it on the question whether the company is a corporation. I think it is one of those special partnerships which are called joint-stock companies, well known in England for nearly a century, and cannot maintain an action or be sued as a corporation in this country without legislative aid. But as it is a company associated under the laws of a foreign country, it comes within the scope of the Massachusetts statute, and cannot claim exemption from its operation for the causes alleged in that behalf. It could not have been the intent of the treaty of 1815 to prevent the States from imposing taxes or license laws upon either British corporations or joint-stock companies desiring to establish banking or insurance business therein. And certainly these companies cannot be exempted from such laws on the ground that citizens of other States have chosen to take some of their shares.

JUDGMENT AFFIRMED.


text: Talk:Liverpool Insurance Company v. Massachusetts/Opinion of the Court


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Page:Ulysses, 1922.djvu/652

Rh What counterproposals were alternately advanced, accepted, modified, declined, restated in other terms, reaccepted, ratified, reconfirmed?

To inaugurate a prearranged course of Italian instruction, place the residence of the instructed. To inaugurate a course of vocal instruction, place the residence of the instructress. To inaugurate a series of static, semistatic and peripatetic intellectual dialogues, places the residence of both speakers (if both speakers were resident in the same place) the Ship hotel and tavern, 6 Lower Abbey street (W. and E. Connery, proprietors), the National Library of Ireland, 10 Kildare street, the National Maternity Hospital, 29, 30 and 31 Holles street, a public garden, the vicinity of a place of worship, a conjunction of two or more public thoroughfares, the point of bisection of a right line drawn between their residences (if both speakers were resident in different places).

What rendered problematic for Bloom the realisation of these mutually selfexcluding propositions?

The irreparability of the past: once at a performance of Albert Hengler's circus in the Rotunda, Rutland Square, Dublin, anintuitive parti coloured clownan intuitive particoloured clown [sic] in quest of paternity had penetrated from the ring to a place in the auditorium where Bloom, solitary, was seated and had publicly declared to an exhilarated audience that he (Bloom) was his (the clown's) papa. The imprevidibility of the future: once in the summer of 1898 he (Bloom) had marked a florin (2/-) with three notches on the milled edge and tendered it in payment of an account due to and received by J. and T. Davy,family grocers, 1 Charlemont Mall, Grand Canal, for circulation on the waters of civic finance, for possible, circuitous or direct, return.

Was the clown Bloom's son?

No.

Had Bloom's coin returned?

Never.

Why would a recurrent frustration the more depress him?

Because at the critical turningpoint of human existence he desired to amend many social conditions, the product of inequality and avarice and international animosity.

title: Page:Ulysses, 1922.djvu/652


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The Cotton Plant

APPEAL from the District Court for the Eastern District of Pennsylvania, condemning as prize the steamer Cotton Plant, and her cargo; the case was thus:

An act of Congress of July 2, 1864, passed during the late rebellion, enacts that 'no property seized or taken upon any of the inland waters of the United States by the naval forces thereof shall be regarded as maritime prize;' and directs that all property so seized or taken shall be promptly delivered to the officers of the courts, to be dealt with in a way which the act prescribes.

The capture, which was the subject of this libel, took place on the 10th day of May, 1865, in North Carolina, at the mouth of Quankey Creek, on the Roanoke River, about half a mile below Halifax, and about 130 miles above Plymouth, which lies at the mouth of the river, where the river falls into Albemarle Sound; the river at that point being narrow and shallow. An expedition, consisting of the United States steamers Ioscoe and Valley City, with a picket launch, went up the Roanoke River. The Ioscoe proceeded to Hamilton, which was 50 miles from the place of capture; the Valley City went up the river to a point 32 miles from the place of capture; both vessels stopping at the places where they did on account of the winding course of the stream and from fear of getting aground. An officer and six men were placed on the picket launch, attended by an armed crew from the Ioscoe. The launch, with these crews, proceeded up the river to the place of capture, and there seized the steamer with her cargo then on board, cotton chiefly, and putting on her some other cotton that they brought from a barn on land, recently landed from this same steamer and put in the barn for temporary safe keeping until reladed, sent her to Philadelphia, where she was libelled in the District Court and condemned, as already mentioned.

Her owners appealed to this court. There was no allegation of any breach of blockade.

Messrs. W. L. Hirst and T. R. Elcock, for the appellants:

It is matter of public history that Lee surrendered on the 9th day of April, 1865; Johnston, on the 26th day of the same month; and that thus ceased all hostilities and opposition to the United States, in Virginia and North Carolina. How, in the face of such facts, can the Cotton Plant, on the 10th of May following all this, have been the subject of lawful capture as prize under any circumstances?

But situated where she was, the steamer was not a subject for prize even if war had still been flagrant. The entire expedition by the picket launch was a raid rather than a lawful act of war. The act of July 2d, 1864, is conclusive; declaring as it does, that no property taken, upon any of the inland waters of the United States by the naval forces shall be regarded as maritime prize, and provides, as it also does, another system for all such seizures. Inland means 'remote from the sea.' In the case of Mrs. Alexander's Cotton, the cotton was captured much as some of this was, on the Red River, a few miles above the point where it enters the Mississippi. This court declared that it could not be the subject of a libel as maritime prize, but should have been turned over to be treated as captured and abandoned property under the statutes of 1863 and 1864. It follows that the court below had no jurisdiction. The steamer and her cargo should have been promptly handed over to the agent of the Secretary of the Treasury. Want of jurisdiction in the court below, however, does not prevent this court from assuming jurisdiction on appeal for the purposes of reversing the decree rendered by the court below, and of vacating its unwarranted proceedings.

Mr. C. H. Hill, Assistant Attorney-General, for the United States; Mr. Ashton, for the captors, contra:

Although Generals Lee and Johnston had surrendered in April, 1865, General Richard Taylor did not surrender Mobile till May 4th, six days before this capture, and General Kirby Smith did not surrender until after it, May 23d. These are public historical facts, known to all and of which the court takes notice. War, therefore, still existed, and this capture, to use the words of Lord Tenterden, was 'a hostile seizure, made, if not flagrante, yet nondum cessante bello.'

The Roanoke River, where the capture was made, was not 'inland waters' within the act of July 2d, 1864. It is a short navigable river, flowing directly into tidal waters. The term 'inland waters' has been generally considered as applying to the lakes or to the immense rivers like the Missouri, Mississippi, Ohio, &c., which have their courses a thousand miles from the sea. To come within the act all the waters should be 'inland.' But water which runs directly into the sea is not 'inland,' though the term may apply to such waters as flow into other waters that do discharge themselves into the sea.

This case is different from that of Mrs. Alexander's Cotton. That was cotton seized wholly on land and which grew on the plantation where it was deposited. No maritime capture was made with it, and there was nothing to distinguish it from any other property on land which is ordinarily exempt from condemnation as prize. The Red River, on whose banks that seizure was, enters the Mississippi at a distance of 334 miles from the sea.

Mr. Justice STRONG delivered the opinion of the court.

title: The Cotton Plant


text: Talk:The Cotton Plant

title: Talk:The Cotton Plant


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The Cotton Plant/Opinion of the Court

Whether the steamer Cotton Plant and her cargo of cotton were subject to lawful capture when seized, is a question that need not now be considered; for if it be conceded that they were, we are still of opinion that they were not liable to condemnation as maritime prize. The capture was made within the State of North Carolina, on the Roanoke River, and about one hundred and thirty miles above its mouth. It was made by a naval force detached from two steamers that had proceeded up the river from Albemarle Sound, one about eighty, and the other about one hundred miles, where they stopped, in consequence of the crookedness of the stream and apprehensions of low water. A picket launch, with a crew of six men, and two other boats' crews, were then sent forward, and they effected the capture. It was, therefore, an inland capture, though made upon a river which empties into an arm of the sea, and it was at a point where ordinary vessels of war could not safely go. There was nothing in the situation of the property that required peculiarly a naval force or maritime service to effect its capture. The seizure might as well have been made by a detachment from the army, as by one from the navy. It appears to us, therefore, that in view of the legislation of Congress, the property cannot be regarded as a maritime prize. By the seventh section of the act of July 2d, 1864, it was enacted 'that no property seized or taken upon any of the inland waters of the United States by the naval forces thereof, shall be regarded as maritime prize; but all property so seized or taken shall be promptly delivered to the proper officers of the courts (or) as provided in this act, and in the said act approved March twelve, eighteen hundred and sixty-three.' The language of this section is very comprehensive. It embraces all property seized or taken by the naval forces upon any of the inland waters of the United States. It would be difficult to give any reason for holding that the part of the Roanoke River upon which the Cotton Plant was seized is not described by the phrase 'any of the inland waters of the United States,' as understood by Congress. The river is wholly inland. It is true that it discharges its waters into Albemarle Sound, and that it is accessible directly from the ocean. But, in speaking of inland waters, Congress must have intended waters, within land indeed, yet waters where a naval force can go, and where naval captures could be made. And it is obvious that other waters than those of the great lakes were contemplated and designed to be included. The act was passed during the war of the rebellion, and it was part of a system devised for securing captured and abandoned property in States and districts declared to be in insurrection by the President's proclamation of July 1st, 1862. There was no war upon the lakes, and they were not within insurrectionary districts. If, therefore, the act does not apply to rivers, and to rivers accessible from the sea, upon which naval captures could be made, it could never have had any practical effect. But if it applies to captures upon rivers, what reason can there be for confining its operation to seizures by the naval forces upon rivers that run directly into the sea? The act speaks of captures upon any of the inland waters of the United States. It makes no distinction between rivers that run directly into the sea, and those that flow into others that discharge into the sea. If any distinction exists it is purely arbitrary and judicial, rather than legislative. Both classes of rivers are inland waters; equally such. Maritime service can be no more meritorious or efficient upon one than upon the other. In the absence of express legislative enactment to that effect, no satisfactory reason can be given why a vessel captured on the Red River five miles above its junction with the Mississippi should be turned over to the courts to be treated as captured and abandoned property under the statutes of 1863 and 1864, which does not apply to a capture made on the Mississippi itself, five hundred miles farther from the Gulf of Mexico. Congress probably anticipated, especially in view of the state of the war when the act was passed, that most of the captures on the rivers would be made by the army, and thought it unwise to continue two modes for the disposition of the property taken.

Such being our opinion of the meaning of the seventh section of the act of July 2d, 1864, we must hold that the property captured and condemned in this case ought not to have been regarded as maritime prize, and subject to condemnation as such.

The decree of the District Court is therefore REVERSED, and the case is remanded, in accordance with the rule stated in United States v. Weed, for further proceedings, if the government shall see fit to institute them.

title: The Cotton Plant/Opinion of the Court


text: Talk:The Cotton Plant/Opinion of the Court


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Miller v. McKenzie

ERROR to the District Court for the Northern District of Mississippi.

Pitzer Miller brought suit in the court just named against Larkin McKenzie, James Hamer, Joseph Hamer, and Ezekiel Wall, to recover the value of several bales of cotton. Such proceedings were had that a judgment was rendered for the defendants, whereupon the plaintiff brought this writ of error; the writ reciting that the proceedings were between 'Peter Miller, Larkin McKenzie, and others.'

Mr. P. Phillips, on the part of the defendants, now moved to dismiss the case for want of jurisdiction.

Mr. T. Wilson, contra.

Mr. Justice NELSON delivered the opinion of the court.

title: Miller v. McKenzie


text: Talk:Miller v. McKenzie

title: Talk:Miller v. McKenzie


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Miller v. McKenzie/Opinion of the Court

It appears, from an inspection of the record, that the writ of error is defective in respect to the parties. It is therein recited that the proceedings are between Pitzer Miller and Larkin McKenzie, and others. This defect has been held so many times in this court as fatal to its jurisdiction that it need be but mentioned to require a dismissal of the case.

MOTION GRANTED.

title: Miller v. McKenzie/Opinion of the Court


text: Talk:Miller v. McKenzie/Opinion of the Court


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Stovall v. Banks

ERROR to the District Court for the Northern District of Georgia.

This was an action of covenant upon an administration bond, brought by the ordinary of Morgan County, Georgia, for the use of persons claiming to be distributees of the estate of Alfred Eubanks, deceased, against the administrator, who was the principal obligor, and against his sureties in the bond. At the trial the plaintiff offered in evidence the record of a suit in chancery in the Morgan County Superior Court, in which the persons for whose use this suit was brought were complainants, and the administrator, with others who also claimed to be heirs and distributees of the estate of the decedent, were defendants. By that record it appeared that the Superior Court adjudged the sum of $31,743.50, assets of the decedent's estate, to be in the hands of the administrator, and made an order distributing the whole. In the distribution $3820 were decreed to be paid to each of the complainants in the bill, and it was ordered that they should have executions for the respective sums adjudged to them on application to the clerk of the court after four days from its adjournment. The record further exhibited that executions were issued upon the decree, that no objection was made to the issue, and that to all of the executions the sheriff returned, 'No property of the defendant or of the estate of Alfred Eubanks to be found upon which to levy.'

In addition to this, however, the record showed that the court, after having fixed the sum due to each complainant, and ordered its payment, and after having awarded execution, went on to direct that the administrator should be allowed as payment to the respective parties, to be deducted from the amounts therein adjudged to them, the principal and interest of any note held by him against either of them; and also that the several shares of the parties to whom the estate was awarded should be subjected to ratable deduction for fees yet unpaid for the collection of notes belonging to the administrator.

When this record was offered in evidence the District Court rejected it, holding that the decree was not final, and consequently that it could not be read in evidence for any purpose in the case. This action of the court was now here for review.

Mr. J. D. Pope, for the plaintiff in error:

The last sentence in the decree was the ground doubtless for the rejection. But it was insufficient. It does not appear that any portion of the litigation was held back for future adjudication. A decree in which nothing is so held back must be final. The right reserved in the present case is no more than a right reserved to pay in any specific piece of property or in a designated kind of currency. A decree is not less final in its nature because some future orders of the court may possibly become necessary to carry it into effect.

Mr. D. T. Walker, contra:

1. The record of the suit in the Morgan County court, offered in evidence and rejected by the court below, was so incomplete that it would not support an action. Matters were left open by it, and until these were adjusted the decree had nothing specific and final in it. The case of Sadler v. Robins, 1 Campbell's Nisi Prius, seems exactly in point. The attention of this court is directed to it.

2. If admitted, the decree would have such effect only as it had in the State court, and in that court it was only prim a facie evidence as to the surety. Judgments bind none but parties and privies, and there is no such privity between principal and surety. If it had been admitted, and that effect had been given to it, the result in this case would have been the same.

3. Finally, the court of Morgan County and the Supreme Court of the State, we may add, on appeal, fell into the fatal error of holding the marriage, in virtue of which the distributees in this case claimed, to have been voidable instead of void.

[The counsel then went into an argument upon evidence taken on commissions from the court of Morgan County and found in the transcript, to show that the distributees, for whose use the suit below was brought, claimed in virtue of a marriage which had no legal existence.]

Mr. Pope, in reply, went largely into this same evidence, to show that the conclusions of the opposing counsel could not on the evidence be sustained.

Mr. Justice STRONG delivered the opinion of the court.

title: Stovall v. Banks


text: Talk:Stovall v. Banks

title: Talk:Stovall v. Banks


text:
Stovall v. Banks/Opinion of the Court

The court below rejected the record of the suit in chancery in Morgan County Superior Court, holding that the decree was not final, and consequently could not be given in evidence for any purpose in the case. In this we think there was error. It cannot be maintained that a decree which adjudges a certain sum of money to be due from a defendant to the complainant, and awards execution to collect it, is not a final decree conclusive upon the parties. We do not overlook the fact that in this instance the court, after having determined the sum due to each of the complainants and directed its payment, and after having awarded execution, went on to direct that the administrator be allowed as payment to the respective parties, to be deducted from the amounts therein adjudged to them, the principal and interest of any note held by him against either of them. It also directed that the several shares of the parties to whom the estate was awarded should be subjected to ratable deduction for fees yet unpaid for the collection of notes belonging to the administrator. But we think the decree was not, for this reason, the less final.

Even if the sum decreed was left indeterminate, it was certainly adjudicated that the complainants were entitled to participate in the distribution, and the extent of their interest was defined. But it does not appear that there were any unpaid fees, or that the administrator held any notes against either of the distributees. All that these parts of the decree meant, therefore, was either direction to the sheriff respecting the execution of the ''fi. fas.'', or liberty to the defendant to move for a modification of the decree,-a motion never made. Plainly they were not intended to prevent the enforcement of the decree by executions against the administrator, for such executions were expressly allowed. It is not unusual in courts of equity to enter decrees determining the rights of parties, and the extent of the liability of one party to the other, giving at the same time a right to apply to the court for modifications and directions. It has never been doubted that such decrees are final. They are all that is necessary to give to the successful party the full benefit of the judgment. In Daniell's Chancery Practice, the effect of allowing the privilege of making such applications to the chancellor, is stated to be no alteration of the final nature of the decree. Says the author, 'A decree with such a liberty reserved is still a final decree, and, when signed and enrolled, may be pleaded in bar and, when signed and matter.' So in Mills v. Hoag, it was said that 'a decree is not the less final in its nature, because some future orders of the court may possibly become necessary to carry such final decree into effect.' In the case before us no future orders were necessary. The decree was ripe for execution, and execution was ordered.

We are referred, however, to the nisi prius case of Sadler v. Robins, 1 Campbell's Nisi Prius Reports. Without dwelling upon the fact that those Reports have not always been considered safe authority, an examination of the case, as reported, will reveal that it does not sustain the ruling of the District Court. It was an action of assumpsit on a decree of the High Court of Chancery in Jamaica. The decree was for a certain sum, current money of the island, 'first deducting thereout the full costs of the defendants expended in the said suit, the same to be taxed by George Howell, Esquire, one of the masters of the said court, and also deducting all and every further payment or payments which the said James Sadler and R. Haywood, or either of them, might, on or before the first day of January, 1806, show to the satisfaction of the said George Howell that they or either of them had paid on account of their said testator's estate.' This decree Lord Ellenborough held to be incomplete, and ruled that assumpsit would not lie upon it. But it must be observed that there were certainly unascertained deductions to be made. Costs had been expended by the defendants, and the plaintiff might have had them taxed, even if the defendants had not appeared to tax them. It was for this reason the decree was adjudged not complete. There was not, as in the present case, an award of execution to enforce the decree, and there could not have been, for there was a reference to a master to ascertain definitely its amount.

It has been argued on behalf of the defendants in error that the decree of the Superior Court, if admitted, would have been only prim a facie evidence against the sureties in the bond. Were that conceded it would not justify the exclusion of the evidence. But the concession cannot be made. The decree settled that the administrator of the intestate, Alfred Eubanks, held in his hands sums of money belonging to the equitable plaintiffs in this suit, as distributees of the intestate's estate, which he had been ordered to pay over by a court of competent jurisdiction, and the record established his failure to obey the order. Thereby a breach of his administration bond was conclusively shown. Certainly the administrator was concluded. And the sureties in the bond are bound to the full extent to which their principal is bound. A principal in a bond may be liable beyond the stipulations of the instrument, independently of them, but so far as his liability is in consequence of the bond, and by force of its terms, his surety is bound with him. There may be special defences for a surety arising out of circumstances not existing in this case, but in their absence, whatever concludes his principal as an obligor concludes him. He cannot attack collaterally a decree made against an administrator for whose fidelity to his trust he has bound himself.

Much of the argument upon both sides of this case has been devoted to the consideration of the inquiry whether the Superior Court of Morgan County and the Supreme Court of Georgia rightly adjudged that the equitable plaintiffs are entitled to a share of the estate of the decedent in the administrator's intestate. That is no longer an open question. It was concluded by the decree offered in evidence. It cannot be tried again in this case.

JUDGMENT REVERSED, AND A NEW TRIAL ORDERED.

title: Stovall v. Banks/Opinion of the Court


text: Talk:Stovall v. Banks/Opinion of the Court


text:
Stagg v. Insurance Company

ERROR to the Circuit Court for the District of Missouri; the case being this:

Stagg became the agent of the Connecticut Mutual Life Insurance Company, in October, 1849, by his acceptance of a circular which contained this language:

'The usual compensation of agents, so far as we know, is 10 per cent. commission on the premiums, with one dollar for each policy, and 5 per cent. on the premiums on the renewal of policies.'

This circular gave him certain instructions about his agency, and some suggestions as to the modes of inducing persons to insure with the company. In about a year afterwards he received another circular like the former one in its main purpose, but much more full and specific; a sort of short essay on the subject of life insurance, setting forth its advantages, and pointing out the various reasons which the agent might advantageously suggest to persons whom he should address, why they should insure their lives, and do this with the Connecticut company rather than with any other company. This second circular, intended obviously for his careful perusal and study throughout, contained, in lieu of the language above cited, from the first one, the following:

'For your services, as above, you will be allowed a commission of 10 per cent. on the first premiums (cash and notes), and 5 per cent. on all subsequent renewal premiums, so long as you continue the agent of the company.'

The plaintiff received and acted on this latter paper for about fifteen years, when he was discharged. He now brought this suit, claiming some $3000, as the 5 per cent. commission on the renewal premiums of policies originally made by him as agent, which had been received by the company since he was discharged.

To support this claim he undertook to prove by other insurance agents that such was the custom as between insurance companies and their agents. But the court ruled as matter of law that there was an express contracts in the case, and that the custom could not be admitted.

It also ruled that the later circular was substituted as a new contract instead of the first one, and that its fair construction was to limit the agency to the pleasure of the company, and to terminate the right of the agent to commissions on renewal premiums with the revocation of his agency.

These rulings, or more particularly the second one, made the error complained of.

Mr. J. C. Moody, for the plaintiff in error:

When Stagg received the second circular, he had already a contract with the company fixing the terms of his agency. He knew they could not be changed without his consent. If the company wanted to change them he might well have presumed that they would address him directly upon the subject. He might have overlooked the little clause in question of the second circular entirely, covered up, as it was, in a mass of other matters; or, if it had caught his attention, he might have thought that it was meant for subsequently employed agents.

Now, if he did not notice the clause, that is to say, if he did not really apprehend it as a proposition directly made to him, how shall he be bound by it? It becomes, then, a main question in the case, 'Is it so plain that the circular was meant to bring about a change in the terms of Stagg's agency, that the law will impute to him a recognition of such intent?' Let it be kept in mind that it takes two to make a bargain, and as many to unmake one. The use proposed to be made of this circular is to unmake a bargain of a year's standing; to convert the circular into a direct personal address to Stagg, saying: 'Either give up your contract entitling you to an interest in renewals, or by which you claim such interest, or resign.' But the Connecticut Life Insurance Company was possessed of no authority to deal with its agents in this military style. It had contracted with Stagg, and if it was dissatisfied with its contract, it should have addressed him directly on the subject, in the usual way of conducting a business correspondence. The clause in the circular looks like a trap to catch the unwary.

But assuming that the circular is the equivalent of a direct appeal in the usual mode of a commercial correspondence, proposing that Stagg accept of the new terms of resign, is his silence acceptance of the new terms? We deny that it is. If A. has bought a horse of B., and obtained possession at the agreed price of $200, would he be bound to take any notice whatever of a note from B. informing him that if he retained the horse he would expect $500 for him? If an auctioneer had sold a hundred horses, and delivered them, or a hundred houses, and delivered them, could he impose new terms upon the purchasers through the instrumentality of a circular like this? Of course not, in either case. Stagg, before and at the issuing and reception of the circular, had his contract with the company, and possession under it. He was no more bound to answer a proposition from the company for new terms than was the company to answer a similar proposition from him. The limit of his right in that direction was to write to the company, saying: 'Send me better terms, or I resign.' The limits of the company's right with him was a direct note, saying: 'Accept harder terms, or we turn you out.' It could not even say, 'Accept the harder terms, or resign.' If it had, he would not have been bound to resign. Nor would his failing to resign afford an argument that he had accepted the harder terms. He had, in that view, the right of continuing on under his old contract until removed.

So we may say that, admitting the clause referred to in the circular was meant for Stagg; that he so understood it; that he was bound to treat it as a direct proposition to accept the new terms or resign (all which matters we deny), it put no obligation upon his either of accepting the new terms or of resigning.

The company not being possessed of power to compel his resignation, but only to remove him, he might well wait to see, if after all, they would go so far as to turn him off. Possibly they might not do so.

We do not deny that the agency held under the letter of 1848 was held at the pleasure of the principal. Our proposition is that, being so held, the company never revoked it until they removed Stagg in 1864; that the agency was not revoked by the circular of 1849.

Mr. J. M. Krum, contra.

Mr. Justice MILLER delivered the opinion of the court.

title: Stagg v. Insurance Company


text: Talk:Stagg v. Insurance Company

title: Talk:Stagg v. Insurance Company


text:
Stagg v. Insurance Company/Opinion of the Court

The right of the insurance company to terminate the agency of the plaintiff, at its discretion, is not denied by his counsel, nor is there any serious effort to support the offer to prove the custom. Indeed, if the court was right in holding that the contract between the parties was expressed by the language of the second circular, it is quite clear there was no room for usage, for it is there expressly stated that the commission on the renewal premiums, like those on the original premiums, was to be paid only so long as the plaintiff continued to be the agent of the company.

Nor can we doubt for a moment that the later circular must be held to represent the agreement of the parties as to compensation. After having received that circular and acted on it for fifteen years, received and adjusted his compensation by it, he is estopped to deny that it was the contract under which he acted. If there was any other contract it was for him to show it. He does not do this by producing the circular of the year previous. If there was anything fraudulent, unfair, or illegal in the new terms offered, or in the mode in which he was induced to accept them, he should have shown it, but he has not even attempted it.

We are, therefore, clearly of opinion that when it is shown that, as agent of the company, he received and acted upon that circular, he is bound by its terms as the measure of his compensation.

JUDGMENT AFFIRMED.


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


text:
Ward v. United States (77 U.S. 593)

APPEAL from the Court of Claims; the case being thus:

The Continental Congress, on the 3d day of October, 1776, being in want of five millions of dollars to prosecute the war, resolved to borrow it on what were called loan-office certificates, and to establish a loan office in each State for the convenience of the lenders of money. The resolution directed the appointment by the authority of the State of a commissioner of loans, whose duty it was to receive the certificates from the Treasurer of the United States, and to deliver them for such sums of money as he should be able to borrow. The faith of the government was pledged to redeem these certificates when countersigned by this officer.

In continuation of its policy on this subject, Congress, on the 15th of January and the 22d of February, 1777, provided for a further issue of this class of securities on the basis of the resolutions of the preceding October. Accordingly, certificates in proper form, duly signed by the designated Federal officer, were transmitted to the different loan offices of the country to be given in exchange for money, when countersigned by the loan officer of the State. Some of these certificates were sent to the loan office of Georgia, and among them forty-three, now in the possession of one Ward, as treasurer of a company called the Ohio Company, an old land company composed originally largely of Revolutionary soldiers, and which forty-three certificates made the foundation of the claim in the court below. His petition alleged that they were duly issued and in possession of a bon a fide holder on December 23d, 1781, and about 1787 came into the possession of the Ohio Company, and he now claimed payment from the United States; representing apparently the Ohio Company, the real owner in the matter.

The Court of Claims decided at first in favor of the claim, but the matter was referred back by Congress for a further consideration.

On this second hearing the court found as matter of fact thus:

'2. That it was unknown and could not be ascertained who was the commissioner for the State of Georgia, or whether any such commissioner had been appointed and authorized to countersign such loan certificates; that at the time of the transaction there was no formal loan office in Georgia, and that a large part of the State was in the possession of the public enemy.

'3. That the said loan certificates were not signed by any duly authorized commissioner for the State of Georgia, but that they bore a certificate in the words following, to wit:

"Countersigned: By order of J. A. Treutlin, Esq., Governor of Georgia.

E. DAVIS, JR.'

'4. That there was no evidence to show that E. Davis, Jr., was a commissioner for Georgia, or that he was ever reputed to be such, or that he was authorized to countersign such loan certificates by the State of by the governor of Georgia, or that these are the veritable signatures of E. Davis, Jr.

'5. That interest on certain loan certificates, similar to those in action, was paid by the Treasury Department up to the 23d December, 1781, and that on twenty-nine of the certificates in action interest for four years has also been paid by the defendants, and duly noted and indorsed thereupon, and that no objection to these or similar loan certificates, or to the authority of E. Davis, Jr., to act as commissioner, was taken by the defendants until the year 1792.

'6. That no direct consideration or value ever passed to the defendants from the claimant or from any other person for the said loan.'

In regard to the question about which the Court of Claims certified that no evidence showed it, to wit, whether E. Davis, Jr., was commissioner of loans for the State, &c., it appeared that the questions had been considered in 1792 by Mr. Hamilton, then Secretary of the Treasury, and that in a report dated the 28th of March, 1792, and published at the time, he stated as the result of 'diligent inquiry' on the subject, that he had been unable to obtain evidence either of the appointment of E. Davis to the office of commissioner of loans for Georgia, or that he was ever known or reputed to have acted in that capacity; and that there was no evidence that the paper which he put in circulation had been issued for any purpose of the United States. With this report papers were transmitted to Congress tending to justify his conclusion, and to show that the certificates were placed in the hands of Davis by the executive council of Georgia, to purchase goods for the State. These papers consisted of an affidavit of John Wereat, auditor of Georgia, and a long time resident there, denying that Davis, whom he well knew, was at any time commissioner of loans; of letters from Richard Wyllzhyr, commissioner of loans of the State in 1791, giving his opinion to the same effect, and a communication from Samuel Steick, of Governor Houston's staff, that the certificates were issued on State account.

The payment of interest Secretary Hamilton conceived to have been unauthorized, and made by mistake of one of the treasurers, a certain Hillegas. He notes that such mistakes had occurred, and that there were examples of payment on both forged and counterfeit certificates; a payment which he observes 'could not confer validity upon a claim originally destitute of it, though it might occasion hardship to individuals, who, on the faith of that payment, might have been induced to become possessors of these certificates for a valuable consideration.' There was, however, no intimation that such was the case with regard to these certificates.

In 1795 the same certificates apparently were presented by one Tracy 'for Benjamin Talmadge,' who sought to have them funded, but, in consequence of the objections previously made to them by Mr. Hamilton, they were rejected.

According to a statement of Ward, found among the public documents, the certificates were presented to the treasury in 1792 by Mr. Talmadge (who was treasurer of the Ohio Company from 1791 until 1825), and remained there until 1812. In that year having, according to this statement of Ward, been sold by Mr. Talmadge, treasurer of the company, at public auction, and bought by one John Delafield (though still according to Ward's statement considered the property of the Ohio Company), the certificates were withdrawn from the treasury, and Congress was asked to pay them, on the petition of Delafield, who states in his petition that he owned them, and wished them funded for his benefit.

Before the committee of Congress which had charge of the subject, and of which Mr. Talmadge was chairman, many letters and documents were produced; letters from Major Hugh McCall, a revolutionary officer of Georgia, and others, to show that the claim was well founded; among them a letter giving a history of the two persons already named (Wereat and Steick), who had certified in the papers accompanying Mr. Hamilton's report, in a way which made against the claims; Major McCall's letters tending to prove that Wereat and Steick were uninformed of the passing events during Governor Treutlin's administration; also a certificate of Sheftall, Esq., stating that E. Davis did in the latter part of 1777 receive an appointment from Governor Treutlin 'similar to that of commissioner of loans,' and countersign certificates. Divers well-known persons testified that Mr. Sheftall's integrity was great, and his knowledge of events in the revolutionary war was supposed to be superior to that of any person living; that he had 'an unusually strong memory,' and that they would consider him in 1816 quite competent to speak about the matter in question.

The committee, of which Mr. Talmadge was chairman, reported in successive sessions of the Fourteenth Congress in favor of the payment. But Congress did not pay the claim.

On the case as found by them the Court of Claims decided as matter of law:

'1. That no cause of action would arise upon the said loan certificates unless the same were duly countersigned by a commissioner for the State of Georgia.

'2. That in the absence of other evidence the indorsements of E. Davis, Jr., did not raise a legal presumption that E. Davis, Jr., was a commissioner for the State of Georgia, or that he was authorized to countersign such certificates, or that the signatures are the veritable signatures of the said E. Davis, Jr.

'3. That the payment and cancellation of certain similar loan certificates and the payment of interest for four years upon certain of the loan certificates in action did not raise a legal presumption that E. Davis, Jr., was a commissioner for the State of Georgia, or authorized to countersign such loan certificates, and do not estop or conclude the defendants from controverting such authority and signature.'

The claimant now brought the case here.

Mr. Stanbery and Mr. T. Ewing, Jr., for the appellant:

This claim is old, but not by the fault of the claimant; for until 1855 there was no forum provided by the United States to hear and decide it. Meanwhile, as is matter of historical knowledge, all the executive records in Georgia were destroyed by fire, in 1780. And 'the papers of the State of Georgia, on which a settlement was made by the United States with that State,' were burned in August, 1814, with other records of the United States Treasury.

Evidence of contemporaries abundant to prove the claim perished before the United States provided a court to hear or perpetuate it. The time of the issue was not favorable to strict method in governmental transactions, and they were very loosely conducted. These certificates were executed and sent to Georgia while the Continental government was on the wing from Philadelphia to Lancaster, and thence to Yorktown. The date was left blank, and apparently also the name of the payee, to be filled up by the State agent, and they were charged in the first instance to nobody. The State was at that time invaded and this fund was sent to enable the local government and forces to make head against the enemy, which soon after overran the rest of Georgia, took its capital, and drove its executive officers from the State.

In a report to the House of Representatives, in 1797, the Honorable Dwight Foote, chairman of the committee on claims, said:

'It will be recollected that at the commencement of the war the United States were destitute of money, and during a long period of years afterwards were obliged to rely principally on credit in all of their important operations. Having at that time no settled National government, a regular system for conducting public business, especially money transactions depending on credit, was not to be expected. Great numbers of individuals were necessarily invested with the power of binding the public by their contracts. Almost every officer of the army, whether in the commissary department or otherwise, in different stages of the war, had it in his power to contract debts legally or equitably binding on the United States.'

In view of these circumstances, this case should be judged without unfriendly presumptions from the absence of evidence which perished by time or fire before a court was allowed to hear or perpetuate it, or from that apparent want of method in the transaction which came of the exigencies of the Revolution, to promote which these certificates were expended.

But the positive recognition of the claim is great. The payment of interest for four years, which was of course indorsed on the certificate, gave them a currency which was above all reproach. They were payable to bearer. The report of 1792, doubtless prepared by a clerk, bears the signature of Alexander Hamilton, and the shadow of his great name seems to have thenceforth obscured the case. But that report was largely founded on the testimony of Wereat and Steick, whose knowledge, the far better information of Mr. Sheftall shows to have been bad, in regard to the relation which E. Davis, Jr., bore to these certificates; and in this tribunal no name, however high, and no error, however ancient or often repeated, if finally refuted, should stop the course of justice.

Mr. Talbot, for the United States, relied largely upon the report of Mr. Hamilton, whose knowledge was contemporary knowledge, and who above all statesmen of the day would have paid any claim against the United States which was not plainly unfounded. There was no evidence whatever that he suffered his clerks to make reports for him on subjects involving the credit and good faith of the United States.

Mr. Justice DAVIS delivered the opinion of the court.

title: Ward v. United States (77 U.S. 593)


text: Talk:Ward v. United States (77 U.S. 593)


text:
Ward v. United States (77 U.S. 593)/Opinion of the Court

The United States deny their obligation to pay the certificates in controversy, because they were not countersigned in conformity with the prescribed regulation of Congress, nor used for their benefit. It will be conceded, if they were not executed as required by the legislation on the subject, that they were irregularly issued, and the United States under no obligation to pay them unless they are estopped in some way from interposing this defence.

It becomes, therefore, of importance, in the first instance, to ascertain whether E. Davis, Jr., who countersigned them, as he says, by order of J. A. Treutlin, governor of Georgia, was commissioner of loans for the State, and whether he negotiated them on account of the United States.

Fortunately, these questions were considered in 1792 by Alexander Hamilton, then Secretary of the Treasury, who was charged by Congress with their investigation. In his report of the 28th of March of that year, he states as the result of diligent inquiry on the subject, that he had been unable to obtain evidence either of the appointment of E. Davis to the office of commissioner of loans for Georgia, or that he was ever known or reputed to have acted in that capacity, and that there was no evidence that the paper which he put in circulation had been issued for any purpose of the United States. With this report papers were transmitted not only justifying the conclusion reached by the Secretary, but tending strongly to show that the certificates were placed in the hands of Davis by the executive council of Georgia to purchase goods for the State. These papers consist of an affidavit of John Wereat, auditor of Georgia, and a long time resident there, denying that Davis, whom he well knew, was at any time commissioner of loans; of letters from Richard Wyllzhyr, commissioner of loans of the State in 1791, giving his opinion to the same effect, and a communication from Samuel Steick, of Governor Houston a staff, that the certificates were issued on State account. This report, with the accompanying papers, was published, and, of course, read by the holders of the disputed paper. If in their power to deny it, interested as they were to do so, it would at least have been attempted. As no contradictory proof was furnished to the Treasury Department, always ready and willing to receive it, it is fair to infer that none existed. But this consideration did not prevent the holders of this paper from seeking to get it funded in 1795. They were met by the accounting officers of the treasury with the same objections taken by Mr. Hamilton, and, as these were not removed, the same result followed. In this condition of things, if the controversy had been between individuals, and there had been another forum to hear and decide it, it would have been resorted to at once, unless the decision of the first tribunal was accepted as final. But the holders of these certificates acted differently. Instead of taking an immediate appeal to Congress from the decision of the treasury, they waited until two decades had passed away. Nahum Ward says that these identical certificates were presented to the treasury in 1792, by Mr. Talmadge, and remained there until 1812, when they were withdrawn and Congress asked to pay them, on the petition of John Delafield, who professed to possess them in his own right. Why this delay of twenty years? No reason is even suggested for it, and none can be given which is consistent with the conduct of men in the ordinary affairs of life. It is absurd to suppose that any one, informed of the grounds of objection to a controverted claim, if there were evidence to remove them, would delay action on the subject until thirty-four years had passed since the transaction, out of which the claim had arisen, occurred.

It is said the forum was changed because of newly discovered evidence, and for proof of this we are referred to the reports of Mr. Talmadge, chairman of the committee, on the petition of John Delafield, made to Congress in 1816 with the accompanying papers. It is hard to reconcile these reports with the ownership of the property as claimed by Nahum Ward. He says the Ohio Company has owned the forty-three certificates since 1791, and yet Delafield stated in his petition that he owned them, and wished them funded for his benefit, and we must suppose the Congress of that day, and especially Mr. Tallmadge, believed the fact to be as stated by Delafield. At any rate the Ohio Company is estopped from denying the change of ownership, as Ward says that Mr. Talmadge, who was treasurer of the company from 1791 until 1825, was ordered to sell the certificates by the company, and did sell them at public auction to Delafield. It is true he couples this statement with another, that, notwithstanding Delafield's purchase, they were considered as the company's property; but this would place Mr. Talmadge in the predicament of aiding, while a member of the National legislature, to procure the payment of a disputed debt for a company of which he was an important officer.

And why the necessity of selling at all unless there were an honest purpose of parting with the title to the property? It surely was as easy to prosecute a just claim before Congress in the name of a corporation as in the name of a natural person. If, then, Delafield purchased the claim free from any trust, as we are bound to suppose in order to relieve the Ohio Company and their treasurer from censure, he did it at his own risk and for a venture, and took it subject to all equities. He cannot plead want of notice of the defences interposed by the United States, because the company of whom he bought, and of which he was a member, were well informed on the subject. It does not appear how or when the title got back in the Ohio Company, nor is it of any consequence, as the company occupies the same position in this litigation that Delafield would had he retained the ownership of the certificates.

But, apart from this view of the subject, these reports to not change the status of the parties to this controversy. The evidence they furnish comes too late, is chiefly hearsay in its character, and should have no weight in the determination of the questions in dispute. It consists mainly of lengthy letters from Major Hugh McCall, of Georgia, addressed to Mr. Talmadge, which seem to be in the nature of arguments against the position taken by the government. One of them is devoted to a futile effort to prove that Wereat and Steick were uninformed of the passing events during Governor Treutlin's administration. It is true the certificate of Mr. Sheftall tends to show that Davis did act in the capacity of commissioner of loans, but although it is certified that he had an unusually strong memory, we place but little reliance on his recollection in 1816, of what transpired in the commissary department of Georgia in 1777-78. Especially do we distrust his memory of these events when it is in opposition to the recollection of others, equally trustworthy, who testified in 1792, twenty-four years nearer the time when the certificates were put in circulation.

It is urged that the United States is not in a position to contest the validity of these certificates, because of the payment of interest for a period of four years. The report of Mr. Hamilton takes the ground that the interest was paid by the mistake of the treasurer, and without authority, and therefore not binding on the United States. It is very clear that there was no purpose on the part of the government to ratify the acts of Davis, for the paper bearing his name was rejected, as soon as the attention of the proper department was called to it. But it is not necessary to discuss the general rules of law on the subject of ratification, and to show in what state of case they are applicable, for, in our judgment, under the circumstances of the claim, as they appear in this case, there is no equity raised in favor of the Ohio Company against the United States.

Without pursuing the subject further, or noticing the various reports in Congress adverse to this claim, we are satisfied it is not a just charge on the treasury of the United States.

JUDGMENT AFFIRMED.

I dissent from the judgment of the court in this case. I am of opinion that the demand of the plaintiff is a just obligation of the United States, as binding as any part of the public debt of the country.


text:
Page:Ulysses, 1922.djvu/653

650 He believed then that human life was infinitely perfectible, eliminating these conditions?

There remained the generic conditions imposed by natural, as distinct from human law, as integral parts of the human whole; the necessity of destruction to procure alimentary sustenance: the painful character of the ultimate functions of separate existence, the agonies of birth and death: the monotonous menstruation, ofmenstruation of [sic] simian and (particularly) human females extending from the age of puberty to the menopause; inevitable accidents at sea, in mines and factories: certain very painful maladies and their resultant surgical operations, innate lunacy and congenital criminality, decimating epidemics: catastrophic cataclymscataclysms [sic] which make terror the basis of human mentality: seismic upheavals the epicentres of which are located in densely populated regions: the fact of vital growth, through convulsions of metamorphosis, from infancy through maturity to decay.

Why did he desist from speculation?

Because it was a task for a superior intelligence to substitute other more acceptable phenomena in place of the less acceptable phenomena to be removed.

Did Stephen participate in his dejection?

He affirmed his significance as a conscious rational animal proceeding syllogistically from the known to the unknown and a conscious rational reagent between a micro and a macrocosm ineluctably constructed upon the incertitude of the void.

Was this affimationaffirmation [sic] apprehended by Bloom?

Not verbally. Substantially.

What comforted his misapprehension?

That as a competent keyless citizen he had proceeded energetically from the unknown to the known through the incertitude of the void.

In what order of precedence, with what attendant ceremony was the exodus from the house of bondage to the wilderness of inhabitation effected?

title: Page:Ulysses, 1922.djvu/653


text: Talk:Ward v. United States (77 U.S. 593)/Opinion of the Court


text:
Merchants' Bank v. State Bank

ERROR to the Circuit Court for the District of Massachusetts, in a suit by the Merchants' National Bank against the State National Bank, upon three checks of Mellen, Ward & Co., on the latter bank, marked 'good' by its cashier, and given to the former bank; amounting, the three, to $600,000.

The case, as developed by admitted facts and by the plaintiff's evidence alone, was thus:

Both banks were associations organized under the National Currency Act of 1864; the State Bank with a capital, as its articles of association seemed to show, of $1,800,000, capable of being increased.

Under this National Currency Act the affairs of 'every such association shall be managed by not less than five directors, one of whom shall be president.' The directors during their whole term of office must be citizens of the United States. Three-fourths of them must have resided in the State one year preceding their election, and reside there during their continuance in office. Each must own at least ten shares of stock, and as such owner he is personally liable to twice their value. All are to be sworn to the diligent and honest administration of the affairs of the association.

The total liabilities of any person, or firm or association, to the bank, shall never, by section twenty-nine of the act, exceed one-tenth of its capital. Bonds are to be deposited as security for the bills of the bank, which by section twenty-one may never exceed 90 per cent. of the bonds deposited. Section twenty-three enacts that no bank shall issue post notes, or other notes, to circulate as money than such as are authorized by the foregoing provisions of the act, and by various sections care is taken to restrain the circulation, and to secure its redemption.

The act by its eighth section enacts that each association organized under it may, 'by its board of directors appoint a president, vice-president, cashier, and other officers, define their duties,' &c., &c. And it authorizes the association to exercise all such incidental powers as shall be necessary to carry on the business of banking by discounting and negotiating promissory notes, drafts, bills of exchange, and other evidences of debt; by receiving deposits; by buying and selling exchange, coin, and bullion, &c. The directors are empowered to regulate by by-laws the manner in which its general business shall be conducted. 'And its usual business,' says the same section, 'shall be transacted at an office or banking-house located in the place specified in its organization certificate.'

The directors of the State Bank defined the duties of their cashier, no otherwise than that by the 1st article of the by-laws he was to notify corporate meetings, and act as clerk at them; by article 7th was to be responsible for moneys, funds, and all other valuables of the bank; by article 11th 'was-(either he or the president)-to sign all conveyances of real estate voted by the directors; and by article 17th was-(either he or the president again)-to sign all contracts, checks, drafts, receipts,' &c.; and also all indorsements necessary to be made by the bank.

Evidence, however, showed that, as matter of fact, the cashier of the Merchants' Bank was intrusted by its directors with large and comprehensive powers in dealing with the funds; so much so that instead of his transactions going regularly, as they occurred, through the books of the bank, and being credited or debited to the accounts to which they severally belonged, there was opened on the books of the bank one general account with the cashier, in which all the debits and the credits arising out of them, were entered to his debit or credit, that these transactions, thus entered on the books, embraced the giving of checks in lieu of bills where discounts were made; giving checks for the purchase of exchange; giving checks for money borrowed of other banks; that the amount of checks thus given for exchange, and in lieu of bank bills on discounts, during the five months prior to the transaction which was the subject of this suit, was $2,500,000, and in addition, that the amount of such checks given for money borrowed of other banks during the same period, was $1,547,000. And that regular printed blank checks were kept by the bank to facilitate these operations of their cashier.

So also evidence derived from the officers of twenty-two banks of Boston, in relation to the dealings of such banks with each other, showed a usage by which, without by-law or vote, powers were intrusted to cashiers of such banks to borrow and lend the money of their banks of and to each; to buy and sell exchange of and to each other, and in all such transactions to pledge the credit of their respective banks-usually by cashiers' check, sometimes by certificates of deposit or memoranda; that these transactions were frequent, involving large sums of money, and that they were uniformly conducted in faith of the implied powers of cashiers, without inquiry; but the usage shown with regard to the powers exercised by the twenty-two cashiers failed wholly to show that any one cashier had ever used his powers to the purchase of gold coin, or had ever certified checks to be 'good.' Nor was it shown that the cashier of the State Bank had, either before or since the transactions on which this suit arose, ever certified as good the check of either depositor or stranger.

In fact, the Supreme Court of Massachusetts had decided in Mussey v. Eagle Bank that a teller could not so certify checks; placing the decision on grounds that seemed general. Such a power, said the court in that case, 'is in fact a power to pledge the credit of the bank to its customers; a power which, by the constitution of a bank, can alone be exercised by its president and directors, unless specially delegated by them, and consequently it cannot be implied as a resulting duty or authority in any individual officer.' Touching the matter of usage, the court said:

'But if a usage had been proved of the certifying by the teller that the check is good, to enable the holder to use it afterwards at his pleasure, such a usage would be bad and could not be upheld. It would give to bank checks, which are intended for immediate use and are the substitute for specie, in the ordinary transactions of business, the character of bills of exchange, payable to the bearer, the bank being the acceptor, and payable at an indefinite time. It would lead to loans to favored individuals, without the usual security. It would substitute checks for cash in the hands of tellers who receive them, and would confer the power upon a single officer to pledge the credit of the bank by the mere writing of his name; a power never contemplated by the legislature, nor intended to be conferred by the stockholders.'

On the other hand, Congress, by its Internal Revenue Act of June 30, 1864, under the head of 'Banks and Banking,' had laid 'a duty of one-twelfth of one per cent. each month upon the average amount of circulation issued by any bank, &c., including as circulation all certified checks, and all notes and other obligations, calculated or intended to circulate or to be used as money.'

In this state of pre-existent laws and usage, or absence of it, the plaintiffs' evidence showed that the Merchants' National Bank of Boston were applied to on the 22d of February, 1867, by Ward, Mellen & Co., brokers, with the statement that they were about to purchase in New York, 'for responsible parties,' three or four hundred thousand dollars of gold, and with the request that the Merchants' Bank would take and pay for the gold as it came from New York at $1.25 in currency (about 15 per cent. below the value at that time in currency); that these responsible parties would be prepared to take it in a few days, and that when thus taken away, it would go through probably some other bank, mentioning, perhaps, the State Bank.

There had been previous transactions in gold between the bank and Mellen, Ward & Co.; and the proposition now made was accepted upon the terms previously fixed in them, viz., that the gold should be a purchase by the bank, with a right of repurchase by Mellen, Ward & Co., on repayment of the cost and a premium 'equivalent to interest on the amount invested by the bank on the gold.'

Under this arrangement, the Merchants' Bank, on notice from Mellen, Ward & Co., on the 26th and 27th of February, took from the Second National Bank, and paid that bank for the same, $400,000 gold certificates, which, so far as appeared, had never been in the hands of or owned by Mellen, Ward & Co., and added the same to the gold of the bank. No obligation, note or memorandum accompanied the transaction as made; it being, as the direct testimony of the cashier and teller of the Merchants' Bank stated, and so far as the transaction appeared on its face, a sale of gold with a right to repurchase; although both the officers named, in written instruments, spoke of it as a loan.

On the 28th of February, Smith, the cashier of the State Bank, came to the Merchants' Bank, in company with Carter, one of the firm of Mellen, Ward & Co., and said to the cashier there, 'We have come in to get an amount of gold,' and that he 'would pay for the gold by certifying the checks when he saw that the gold was all right.' The coin certificates to the amount of $400,000 were by the cashier of the Merchants' Bank, 'passed out to Mr. Smith, cashier of the State Bank.' He counted them, and then handed to the cashier of the Merchants' Bank the two checks of Mellen, Ward & Co., on the State Bank, certified 'Good, C. H. Smith, cashier.' These checks were certified, not at the State Bank, but in the Merchants' Bank, 'on the spot;' and after it was ascertained that the gold certificates received corresponded with the amount for which the checks had been drawn. They had no stamp on them but the usual two cent bank check stamp, that is to say no such stamp as the law requires for an acceptance. On the same day, Smith, the cashier of the State Bank (Carter accompanying him) applied to and received from the teller of the Merchants' Bank $60,000 more of gold, which the bank had previously purchased at the request of Mellen, Ward & Co., upon the same terms as above stated. The cashier was absent, and the teller took from Smith in payment a check for $75,000, similar to ones already mentioned, for the reason, as he says, that 'I delivered the gold to the cashier of the State Bank.' Although it appeared that Mellen, Ward & Co. had been somewhat speculating in a copper stock, and had once obtained a loan on it from the Merchants' Bank, and that the cashier of the bank had a small interest with them in the stock, there seemed to be no proof in the case as it stood before this court, that is to say as it was presented by the plaintiff's evidence alone, that the cashier of the Merchants' Bank, in the delivery of the gold, or the cashier of the State Bank in certifying the checks in payment for it, acted otherwise than with good faith.

On or before the 1st of February following, Ward, Mellen & Co. failed. The subsequent history of the checks was thus given by Mr. Haven, the president of the plaintiff or Merchants' Bank.

'The first time I saw these checks was a little after twelve o'clock, on Friday, the 1st day of March, 1867. I took the checks in may hand a little after one o'clock, on that day, and presented them to the cashier of the State Bank. I said to him, 'I thought you were coming in to pay the money for these checks early this morning.' The cashier replied, 'Yes, I am going out now to attend to it, and get the money.' 'Get the money?' said I; 'didn't you have the money-the gold? were not the gold certificates delivered to you?' 'Yes,' said he; 'I had them here, but they are not here now. I am going out to get it, and will come in and attend to it.' I spoke rather abruptly, and said that he should do it immediately. He looked up and said, 'You hold the State Bank.' I came back and laid the checks on the desk of the teller. About a quarter before two o'clock I took the checks into the directors' room of the State Bank. There were three or four gentlemen present. Either Mr. McGregor (who was a former president of the bank) or Mr. Dana, introduced me to the president of the bank, Mr. Stetson. I presented the checks to Mr. Stetson, the president. Mr. Stetson took the checks and deliberately read them, one by one, aloud to his directors, and those gentlemen who were present. He then said to me that they had not authorized their cashier to certify checks. He turned to Mr. McGregor and said, 'Have we, Mr. McGregor?' Mr. McGregor made no reply. I then said, 'He has certified checks, and those checks were given to the cashier of the Merchants' Bank for gold delivered to him, the property of the Merchants' Bank, and I want payment for that gold.' The gentlemen were considerably excited, and I wanted action. I said to them, 'I have just heard that there is trouble at the sub-treasury. I think you had better go down there; perhaps you will find your gold there, and if you wish it, I will go with you.' The gentlemen went, two of them, Mr. Stetson, the president of the bank, and Mr. McGregor, the ex-president, and we entered the room of the assistant treasurer. I think I introduced them, saying to the assistant treasurer, 'These gentlemen have come in to see if there has not been a large amount of gold placed to the credit of the State Bank."

Farther than as it was to be inferred from this testimony, it did not appear whether the State Bank had or had not got the use of the gold. No proof was given that it did not go to that bank. However, that particular fact might have been, the State Bank refused to pay the checks of Mellen, Ward & Co., certified 'good' by Smith, its cashier, and the Merchants' Bank sued in assumpsit for the amount; some of the counts being special on the transaction, others on a quantum valebat, money had and received, &c.

The case was tried before CLIFFORD, Presiding Justice, and the plaintiff having closed his case, the defendants moved the court to instruct the jury that the evidence was not sufficient to warrant them to find a verdict in favor of the plaintiff, under any of the counts in the declaration, and that as matter of law, the verdict of the jury upon each of them should be for the defendant; and this instruction the court gave.

The case being brought here on error, was elaborately argued at the last term.

Messrs. S. Bartlett, J. G. Abbott, and W. M. Evarts, for the plaintiff in error:

title: Merchants' Bank v. State Bank


text: Talk:Merchants' Bank v. State Bank

title: Talk:Merchants' Bank v. State Bank