Sidebilder
PDF
ePub

portion of them, becomes irrevocable; and in | 10th section of the 1st article of the Constituthis country assent will be presumed if dissent is not expressed. The cases on this subject will be found collected in Burrill on Assignments, 84, 309, 418.

In this case, it is true, no actual assignment was made. But for the purpose of creating a trust it was not necessary. The Act was a law of the State making the Corporation a trustee. What special rights were thus created in favor of the cestuis que trust will be noticed hereafter.

The creation of this trust in favor of the bond holders, if valid, was a contract with them. Confiding in it, they would desist from further efforts to secure the payment of their claims by adverse proceedings. It would be unjust to them to abrogate it, and place them where they stood when the trust was created. The repeal of the section in question, therefore, did impair the validity of this contract, and, if the latter was valid, was a violation of the Consti

tution.

This conclusion, however, is based on the assumption that the law itself, namely: the 11th section of the Act of 1865, was a valid law. If it was not valid its repeal cannot be questioned. It is contended before us that it is invalid because it appropriates the assets of the Bank to persons who are not creditors of the Bank, but creditors of the State only. The objection taken, if valid in fact, is a good one. It was expressly decided in Curran v. Ark., 15 How., 304, that if the capital of a state bank, like the 10*] one in question be withdrawn by the State, either for the payment of its own debts or for deposit in the state treasury, it is a violation of the pledges by which the capital of the Bank, though derived from state resources or state obligations, was set apart and appropriated as the basis of the independent credit of the Bank; and that a law passed to effect such a withdrawal or misappropriation impaired the validity of the contracts held by the creditors of the Bank.

That case had in it many features of the present one. The Legislature of Arkansas, amongst other things, required the bonds of the State held by the Bank of Arkansas to be given up and canceled; and authorized the Bank officers to receive in payment of debts due the Bank bonds of the State issued to raise capital stock for the Bank, notwithstanding the bills of the Bank might not have been taken up. "We can not attribute to this provision of the law," says the court, "any other meaning or effect than what is plainly apparent on its face. It authorizes and requires the assets of the Bank to be appropriated to pay debts of the State; and we cannot conceive how this can be reconciled with the rights of creditors to those assets." P. 317. The Bank in that case, as in this, was insolvent, and the court held that all its assets formed a trust fund for the payment of its creditors; and that a stockholder could not lawfully withdraw any part of this fund from appropriation to that object; and that a law passed for that purpose was unconstitutional. The majority of the court was clearly of opinion that a right on the part of the State to withdraw the funds of the Bank for the uses of the State, or to pay the debts of the State, would render the Bank itself obnoxious to the

tion, which prohibits a State from emitting bills of credit, inasmuch as it would destroy the distinctive existence and independent credit of the Bank, which independent credit is founded on the inviolability of the capital pledged for the payment of its debts.

Now, in this case, the assets of the Bank of the State of *South Carolina, which still [*11 remained in 1865, were the resultant of all its capital and operations. We hold with the Supreme Court of the State that they were not profits, nor the subject of any previous pledge of profits to any specific class of debts. Any question, therefore, arising upon any such previous pledge may be laid out of the case. The only question is, whether the appropriation by the State Legislature of these assets to the payment, first, of the Fire Loan bonds, and, second, of the Fire Loan stock, was valid and effectual.

As to the latter, we think the Supreme Court was clearly right. The Fire Loan stock was clearly not a debt of the Bank, but a debt of the State alone; and the appropriation of the assets of the Bank to its payment was directly within the case of Curran v. Ark.

As to the Fire Loan bonds, there is more room for doubt. These bonds were the debts of the State and not of the Bank, it is true, but their payment was guarantied by the Bank; and it is strenuously insisted that this circumstance rendered them so far obligations of the Bank that the latter might be justified in providing for their payment in preference to their other creditors. Had the Bank done this, the question as thus presented would have fairly arisen. But the Bank as a distinct entity, never did make such an appropriation of its assets. The appropriation which was made was an appropriation by law; and that law was made by the State itself the principal debtor. The case was the same, in principle, as the Ar kansas case. The Legislature of South Carolina, by law, appropriated the assets of the Bank to pay the debts of the State. This it could not do without violating the pledges made to the creditors of the Bank, even though the particular debts thus preferred were guarantied by the Bank. The Fire Loan bonds were not due by several years when this Act of appropriation was attempted to be made. No claim had yet accrued thereon against the Bank. So far as appears, there were not even any arrears of interest due. It did not then appear that the Bank ever would be liable for the debt. It was the duty of the State to prevent *such lia- [*12 bility from ever arising. These special circumstances under which the Law of 1865 was passed bring it still more clearly within the decision of Curran v. Ark., 15 How., 304.

The decree of the Supreme Court of South Carolina must be affirmed.'

Mr. Justice Strong, dissenting:

I concur in the judgment given in this case, but not in all the positions taken in the opinion of the majority of the court. I cannot regard the 11th section of the Act of the General Assembly of South Carolina, passed December 21, 1865, as amounting either to an assignment or a declaration of trust of the property of the Bank in favor of the holders of the Fire Loan bonds. In my opinion it effected no transfer,

either legal or equitable, and vested no interest in the creditors. Hence the repeal of the Act by the Legislature, in 1868, was no disturbance of any vested rights, and it is not obnoxious to the objection that it impaired the obligation of any contract. For this reason, and for this reason alone, I think the judgment should be affirmed. Mr. Justice Miller and Mr. Justice Davis, dissenting:

We concur in what is said by our brother, Strong.

WILLIAM C. ZANTZINGER et al., Appts.,

v.

WILLIAM GUNTON and The Bank of Washington.

(See S. C., 19 Wall., 32-37.)

The answer of the defendant, which is fully sustained by the proof, sets up two defenses, either of which is, in our opinion, sufficient:

1. It sets up and relies upon the instrument which appointed and directed that he should pay any balance remaining of the proceeds of the sale of the lots, after satisfying the note. to the trustees of the Bank of Washington.

As these instruments are all under seal and

by the common law imply on their face a good consideration, they show that the grantor had parted with all his interest in the property. The legal title was in the trustee, and the equitable interest in the trustees of the Bank. His direction to the trustee to sell, and his subsequent direction to pay the proceeds to these trustees, carried all the interest he ever held. Of course, no interest in these lots or in the proceeds of their sale passed either by his will or by inher

Deed to trustee to secure bank-note-rights of itance to the complainants. bank-interest of in the lands.

1. Where a person executed a deed of lands to a trustee in trust for the payment of the grantor's note to a bank, and by instrument under seal gave his direction to the trustee to sell, and to pay the proceeds to the trustees of the bank, no interest in these lands or in the proceeds of their sale passed, either by his will or by inheritance, to his devisees

or heirs.

2. It is no objection to such an arrangement

that the bank could not purchase or hold real estate.

3. The trustees of the bank never had the legal title, the control or the ownership of the land, and their only interest was a right to the proceeds when the lots should be sold under the deed of trust.

[No. 199.]

Argued Jan. 20, 21, 1874. Decided Mar. 3, 1014.
A
PPEAL from the Supreme Court of the Dis-
trict of Columbia.

2. But the answer and the evidence further show very fully that William Fisher only held the legal title as naked trustee without interest, for the use of the trustees of the Bank of Washington. About the period of the expiration of the charter of that institution, it became necessary, in order to secure payment of a debt due to it from Daniel Carroll, to have the lots in question, on which they had a lien, placed in a situation where the money could be realized. The lots were accordingly purchased by Fisher, at the request of the trustees of the Bank, who furnished the money, and the note and trust deed to Gunton (who was one of the trustees of the Bank) were devices by which the lots were devested of other liens and placed in the hands of Gunton, so that on sales to be made, at convenient times and fair prices, the proceeds in the shape of money could be paid to the trustees who had the management of the Bank. Fisher never paid any money, nor was it intendHis note was placed in the Bank, and was by it protected and *can- [*36 celed in due time. It was on his part a mere act of friendship to accept the trust and confidence reposed in him by the trustees of the Bank, and he carried out faithfully the requirements of that trust. The efforts of the present complainants to take advantage of this confidence, and to assert an interest which he never thought of claiming, do not commend themselves to a court of equity, and the technical rules of the law on which they are based should be very clearly in their favor to enable them to succeed. We are of opinion they have no place here.

The case is stated by the court.
Messrs. R. T. Merrick, Francis Miller and
Thomas J. Durant, for appellants.
Messrs. Jno. D. McPherson and W. D. Dav-ed that he should.
idge, for appellees.

Mr. Justice Miller delivered the opinion of the court:

By devises in the wills of William Fisher and Harriet Fisher, the complainants, who are also appellants in this case, became the owners of all the real estate left by William Fisher at his decease. In his lifetime he had held the legal title to certain lots in Washington City, for which he and the said Harriet, his wife, had made a deed of conveyance to William Gunton. This conveyance was declared to be in trust to secure the payment of the note of William Fisher for $6,065.84, at sixty days, payable to his own order; and it authorized a sale of the property for that purpose, and to pay the balance, if there should be any, as the grantor might by further instrument in writing direct. He afterwards did, by a formal instrument, direct that after the sale of all the lots and the payment of the note and interest and the costs of the trust, including compensation to the trustee, any remainder should be paid to the trus-ownership and control of it, the question pretees of the Bank of Washington.

The complainants in their bill, omitting any statement of the latter instrument, and treating the deed of trust as a mere security for his 35*] note, allege that there is a balance in the hands of the trustee, Gunton, to which they are entitled, and call upon him for an account.

It is said that neither the Bank, whose charter had expired, nor the trustees who were authorized to wind up its affairs, could purchase or hold real estate.

As a general proposition this may be true. And if the transaction here was in its effect to vest in the Bank the real estate in question, either by its legal title or the absolute equitable

sented and argued by counsel would arise if complainants were in position to raise it. But it is very clear that no such effect can be given to the transaction we are considering. The Bank had a debt due to it and a lien on this property. The right of the Bank, or its liquidating trustees, to have this property so sold as to pay this debt

is undoubted. If in doing this they were compelled, for their own protection, to buy off other incumbrances, so that when sold and converted into money all of it should be paid to them, no principle of law or justice was violated. Neither the Bank nor the trustees of the Bank ever had the legal title or the power of sale or the right to control the time or the terms of the sale. If Gunton, the trustee, had failed or refused to sell, or died without a sale, no power lay in the trustees of the Bank to make a sale or to receive the title. Their only remedy would have been to assert their right to a sale and to the proceeds of it in a court of chancery.

It cannot be said, then, that the trustees of the Bank ever had the legal title, the control or the ownership of the land, and their only interest was a right to the proceeds when the lots should be sold under the deed of trust. 37*] This was not, *in our opinion, forbidden by any law of the District, statutory or other wise. Nor do we think it worth any consideration that Fisher's note was given in the transaction. He incurred no risk; he acquired no real interest in the property and claimed none; and if he ever had a technical legal interest he parted with it when he gave the deed of trust and the subsequent authority to pay the proceeds of the sale to the trustees of the Bank. The decree of the Supreme Court of the District is affirmed.

THE BALTIMORE & POTOMAC RAILROAD COMPANY, Piff. in Err.,

v.

THE TRUSTEES OF THE SIXTH PRESBY

TERIAN CHURCH.

(See S. C., 19 Wall., 62-65.)

Writ of error to Supreme Court of District of Columbia-Act of 1801.

1. A writ of error lies from this court to the Supreme Court of the District of Columbia, on a judgment confirming an assessment for damages by the use of the street in front of the church of defendants in error, although the proceedings before the jury and the marshal, and in the Supreme Court are governed by a Statute of Maryland, which, by the construction of the courts of that State, does not allow an appeal or writ of error. 2. The early decisions of this court held that the right to the writ exists in such cases by virtue of the appellate power of this court as defined by the Act of 1801, creating the Circuit Court of the District; and we are governed by the same Act.

[blocks in formation]

The defendants in error instituted proceed ings before the marshal and a jury of the District of Columbia, to recover damages of the Railroad Company, sustained by reason of the road of the Company having been run through Sixth Street, in front of their church.

Headnotes by Mr. Justice Miller.

The

| jury assessed the damages at $11,500, and on the return of this inquest into the Supreme Court of the District of Columbia, the inquisition was confirmed and a judgment rendered that the defendants in error recover of the Railroad Company that sum, with costs. The Company having brought the case to this court on writ of error, a motion is now made by defendants in error to dismiss it for want of jurisdiction in this court.

This want of jurisdiction is based on two propositions:

1. That the proceeding is in its nature summary and special, and is of that character in which the action of the court confirming or quashing the verdict of the jury, is conclusive and admits of no appeal.

2. That the proceeding in this case is governed, both before the jury and in the Supreme Court of the District by a Statute of Maryland, which, by the uniform construction of the court of that State, does not allow an appeal or writ of error to any other court.

It is certainly true that the proceeding is of the character claimed and that, as a general rule, no appeal or writ of error lies in this class of cases.

[ocr errors]

But the appellate jurisdiction of this court over the doings of the Supreme Court of the District is established and regulated by Act of Congress, and a reference to the statutes on this subject is necessary to the decision of the question before us. The Act which created the Supreme Court of the District of Columbia vested in it the same powers and jurisdiction that had previously belonged to the circuit court, which it superseded; and the appellate power of this court was declared to be the same as that which it had, by law, over the circuit court. The Act of February 27, 1801, 2 Stat. at L., 103, organizing the circuit court, declares that any final judgment, order or decree in said circuit court, where the matter in dispute, exclusive of costs, shall exceed the value of $100, may be re-examined and reversed or affirmed in the Supreme Court of the United States by writ of error or appeal, and though the sum limiting this jurisdiction has been increased to $1,000, this statute remains the sole rule governing the right of appeal in all other respects.

We are of opinion that both the questions raised by the motion to dismiss have been explicitly decided by this court.

*In the case of Custiss v. Turnpike Co., [*64 6 Cranch, 233, an assessment for land taken for the use of the company was quashed by the circuit court, and a writ of error was sued out by Custiss from this court. A motion was made to dismiss this writ on the same ground taken in the present case, namely: want of jurisdiction; to which Marshall, Ch. J., replied, that "At the opening of the case some doubt was entertained as to the jurisdiction of the Supreme Court; but that doubt is removed by an inspection of the Act by which the Circuit Court of the District of Columbia is constituted. The words of that Act, descriptive of the appellate jurisdiction of this court, are more ample than those employed in the Judicial Act." He then quotes them as we have given them above.

So in the case of Young v. Bk., 4 Cranch, 384, the court uses this emphatic language in

regard to the same statute: "The words of the Act of Congress, being as explicit as language can furnish, must comprehend every case not completely excepted from them."

It is to be observed also that in this latter case the rights of the bank and the jurisdiction of the court over it were said in argument to be controlled by an Act of the Legislature of Virginia. But the court held that whatever might be the extent to which that statute affected the rights of the parties, the appellate jurisdiction of the Supreme Court depended solely on the Act already quoted.

vessel in proximity on her larboard or starboard side.

2. It was the duty of the steamer to see the schooner as soon as she could be seen; to watch her progress and direction; to take into account all the circumstances of the situation, and so to govern herself as to guard against peril to either ves sel.

3. Where the injured schooner almost at the moment of the collision ported her helm, the law regards it an error and not a fault, and holds the offending vessel to be the cause, and liable as if it had not been done.

4. Where the libel alleges a total loss, and the answer admits it, the steamer is liable for the full value of the schooner at the time of her loss.

5. A decree for such value against the steamer will bar any further claim to the schooner on the part of her owners, and their title will be, thereby, remitted to the owners of the steamer.

But perhaps the most conclusive case in this branch of the discussion, namely: the proposition that the Statute of Maryland governs the right of appeal in the present case, because by the Act of Congress it is adopted as the mode of proceeding in assessing damages and in defining the power of the Supreme Court of the District in the matter, is that of Carter v. Cut-A

ting, 8 Cranch, 251. That was a case in which an order of the Orphans' Court of Alexandria County, being affirmed in the circuit court, an appeal was taken to this court, and a motion was made to dismiss that appeal. This 65*] *motion was based upon the 12th section of the same Act of February 27, 1801, by which it was declared that the circuit court, in appeals from the Orphans' Court, shall therein have all the power of the chancellor of the State of Maryland; and by the laws of Maryland the decree of the chancellor in such case was final.

It will be observed that the analogy between that case and the present is perfect. But the court said in that case that the conclusiveness of the sentence formed no part of the essence of the powers of the court. Its powers to act are as ample, independent of their final quality, as with it. And referring to the language so often cited already, they say: "We cannot admit that construction to be a sound one which seeks by remote inferences to withdraw a case from the general provisions of a statute which is clearly within its words and perfectly consistent with its intent."

We do not feel at liberty to disregard these contemporaneous expositions of an Act of Congress which has furnished the criterion of our jurisdiction ever since the courts of the District were established, and they are so directly in point that we cannot dismiss the writ without overruling them.

The motion is, therefore, denied.

v.

THE SCHOONER MARY H. BANKS, William
H. Bodine et al., Claimants, Appts.,
THE STEAMER FALCON, The Baltimore &
Ohio Railroad Company et al., Claimants.
(See S. C., "The Falcon," 19 Wall., 75-80.)
Rules of navigation-error at moment of colli-

sion-total loss-effect of decree.

1. Steamer found in fault for collision with a schooner when there was ample sea-room, calm weather and water, abundant light, and no other

NOTE.-Collision; rights of steam and sailing vessels with reference to each other, and in pass ing and meeting--see notes to 13 L. ed. U. S. 537;

35 L. ed. U. S. 453.

[No. 210.]

Argued Jan. 28, 1874. Decided Mar. 3, 1874.

PPEAL from the Circuit Court of the Unit

ed States for the District of Maryland. The case is stated by the court.

Messrs. Wm. C. Schley and W. S. Waters. for appellants.

Messrs. J. H. B. Latrobe and S. T. Wallis for appellees.

Mr. Justice Swayne delivered the opinion of the court:

This is an appeal in admiralty from the decree of the Circuit Court of the United States for the District of Maryland.

On the 21st of June, 1867, about half past one o'clock A. M., the schooner Mary H. Banks was proceeding up the Chesapeake Bay to Bal timore. The steamer Falcon, on her way to Charleston, came in view. The night was clear and bright, with moonlight and starlight. The waters of the bay were calm. The schooner was under way with a six knot breeze. The steamer was making from eight to ten knots an hour. The captain of the steamer says: "My steamer is 165 feet long, or thereabouts. I had about three miles navigable water on my starboard bow. On my larboard bow I had all of five or six miles of navigable water. There was no obstacle to the navigation of this sea-room except the schooner." The vessels approached [77 each other and came in collision. The steamer struck the schooner. The answer admits "that the said schooner was cut half in twain, and not altogether in twain as charged"-a difference of small moment, however, inasmuch as it is admitted that she sank in consequence of the collision. The sinking was immediate. The crew were rescued by the steamer and landed at Fortress Monroe. The answer alleges that the collision was caused by the fault of the schooner in porting her helin and coming suddenly under the bow of the steamer when it was too late for the latter to avoid her. The district court adjudged the steamer to have been solely in fault, and decreed accordingly. The respondents appealed to the circuit court. There the decree of the district court was reversed and the libel dismissed. The libellants appealed to this court, and the decree of the circuit court is thus brought before us for review.

This is a simple case. No searching analysis of the testimony is necessary to enable us to find the proper conclusions. It was the duty of the steamer to keep out of the way of the schooner. She had at command all the means

to do so. There was ample sea-room, calm weather and water, abundant light, and no other vessel in proximity on her larboard or starboard side. None other is mentioned as in sight. It was the duty of the steamer to see the schooner as soon as she could be seen, to watch her progress and direction, to take into account all the circumstances of the situation, and so to govern herself as to guard against peril to either vessel.

The steamer was grossly in fault in approaching so near the schooner and at so high a rate of speed. This was the source of the disaster that followed. The only fault imputed to the schooner is, that almost at the moment of the collision she ported her helm. This fact is not satisfactorily established by the testimony. The proof is, that the captain said so after reaching the steamer. He denies it. The mate says, "I kept my course steadily north by west.' He 78] was cross-examined by the respondents' counsel, but no question was asked as to this point. There is no other evidence upon the subject. What was deemed due to porting the helm may have been the effect of the wind after the helmsman fled from his post. If the fact were as claimed it would not mitigate the fault of the steamer. Nor can the desertion of the helmsman at such a time have that effect. The peril was immediately impending. The safety of the vessel and the lives of the crew were at stake. A moment later the collision occurred. The helmsman in his flight was thrown down by the shock and broke his leg. The vessel sank, and the crew would have gone down with her but for the aid of the steamer. If in an emergency so sudden and so alarming an order were given which should not have been given, or an act were done which should not have been done, the law regards it an error and not a fault, and holds the offending vessel to be the cause, and liable as if it had not occurred.

We think the decree of the district court was in all things correct, and should have been affirmed.

After the case was appealed to the circuit court, and before the hearing there, the respondents took testimony showing that the schooner had been raised, repaired and put in good condition. At whose instance and at what cost this was done, and by what right those in possession claimed to hold her, are not shown; nor is it alleged or proved that she was ever tendered back to the appellants. The appellees insist that the facts disclosed entitle them to have the decree of the circuit court affirmed, and rely upon the case of The Baltimore, 8 Wall., 378, 19 L. ed. 463, as an authority to that effect. This is a mistaken view of the subject. In the case of The Baltimore the libel alleged a total loss. The answer expressly denied it. There the sinking was in the River Potomac. The water was shoal. The masts projected eighteen feet above its surface and the position of the hull was clearly discernible 79*] The *vessel could have been easily raised and repaired. Here the libel alleges substantially a total loss, and the answer substantially admits it. No point to the contrary was raised or suggested. The schooner was sunk in the Chesapeake Bay, where the water was five fathoms deep. It is clear, from the proofs, that she could not have been raised and re

paired without a large expenditure of time and money. The case of The Baltimore has, therefore, no application to the case before us. This subject has been under consideration upon two occasions in the English_admiralty court. In The Empress Eugenie, 1 Lush., 139, the owner had raised and repaired the vessel. The cost of the repairs exceeded the original value of the vessel, and this might have been ascertained before the repairs were commenced. It was held that the measure of damages was the value of the ship before the collision, with interest from the date when the cargo would, in the ordinary course, have been delivered, together with the cost of raising and the cost of placing the ship in the dock for inspection less the value of the wreck as raised. It was said "that it was a mistake to have repaired her at all, and that it would have been better to have abandoned her from the first."

In the case of The Columbus, 3 W. Rob., 161, that vessel had sunk the fishing smack Tryall, The owner of The Columbus raised the smack and carried her into Rye Harbor. Notice of this was given to the owner of the smack, with an intimation that the owner of The Columbus was ready to deliver her up and would not be responsible for any further damage or expense that might be incurred by her remaining unrepaired in the harbor of Rye. It does not appear whether she was repaired or not. Dr. Lushington said: "The rule which I consider it incumbent upon this court to follow is this, that if a vessel is not merely run into and partially damaged, but is actually sunk at sea, it is not incumbent upon the owner of that vessel to go to any expense whatever for the purpose *of raising her." He said further, that [*80 the owner of the smack "was not bound to repair her, and might have left her lying in the port," and that the proper course would have been to apply to the court. for an order that the smack be sold and the proceeds brought in to abide the result of the suit. The Columbus was held liable for the full value of the smack as if there had been a total loss; but it was also held that the owner of The Columbus might still apply for an order to sell the smack, and that "the proceeds of such sale will be his own property." Whether, if the smack had been repaired and then tendered back, her owner would have been bound to receive her, is a point not touched upon, and which it is not necessary here to consider. 1 Pars. Ship., 543.

Upon the authority of The Columbus, it is clear that the steamer is liable for the full value of the schooner at the time of her loss. We think that case lays down the proper rule.

There may be interests and complications touching the schooner in relation to which we are not advised and which are not represented in this litigation. We cannot, therefore, order her to be sold and the proceeds to be paid to the owners of the steamer. But, where there is an abandonment by the assured to the assurer, the title of the property passes to the latter. So, where in an action of trespass or trover there is a recovery of the full value of the property to which the action relates, the title of the plaintiff is transferred ipso facto to the defendant. In analogy to the principle of these cases, we adjudge that the decree to be pronounced against the steamer shall bar any further claim

« ForrigeFortsett »