Chicora Co. v. Crews
| Citation | 6 S.C. 243 |
| Parties | CHICORA COMPANY v. CREWS. |
| Decision Date | 23 April 1875 |
| Court | United States State Supreme Court of South Carolina |
BEFORE GRAHAM, J., AT CHARLESTON, MARCH, 1874.
This was an action by the Chicora Exporting and Importing Company of South Carolina against Joseph Crews.
The case was referred to M. P. O'Connor, Esq., as Referee who, on the 17th October, 1873, filed his report as follows:
" On the 4th day of December, 1872, this case was referred to me to inquire into all the matters of law and fact arising therein and report thereon. The following are the facts as made out by the pleadings and testimony:
1. The plaintiffs were, on the 17th day of December, 1863, by Act of the Legislature, created a body politic and corporate, under the name and style of " The Chicora Importing and Exporting Company of South Carolina.'
2. Plaintiffs purchased of George W. Williams & Company, on the 27th day of July, 1863, 100 bales of cotton, weighing 40,661 pounds, at forty cents, paying for the same, in currency $17,987.49.
3. Plaintiffs, on or about December, 1863, it appears, purchased from defendant 150 bales more of cotton, at the rate of seventy-five cents per pound, paying for the same in the prevailing currency, known as Confederate money, $45,600.75.
These two lots of cotton, aggregating 250 bales, were placed in the possession of the defendant, as agent of plaintiffs, at Laurens Court House, where it remained until the close of the war. All charges and taxes upon this cotton were duly paid by plaintiffs to the 30th of January, 1865. One of plaintiffs' witnesses, Mr. A. J. Crews, has sworn that this cotton was good upland, and was worth, at the close of the war, in United States currency, about forty-five or fifty cents per pound; the same grade of cotton sold at this time in New York for these prices.
In the Summer of 1865, Crews, the defendant, it appears, disposed of this cotton through Sibley & Company, of Augusta, and, though repeatedly asked, has refused to render unto plaintiffs any account of the proceeds, and has denied their right to call him to an account.
The gravamen of the defense set up grows out of the alleged fact that plaintiffs having been organized and chartered covertly to run the blockade, they have no status in Court, and have no right whatever of redress or recovery against defendant. Some minor defenses are set up, such as that the payment admitted to be made for the 150 bales being in Confederate money was not a valid payment, and the mere allegation, unsupported by a tittle of proof, that the proceeds of the sale of the 250 bales in the European markets were all absorbed in the expenses attending the shipment and sale of the cotton in Europe. As long as defendant refuses to make an account, he certainly cannot claim the benefit of any such defense.
" I do not, therefore, deem it necessary for me, for the purposes of this case, to consider but the one issue of law which is raised in the case, and upon the determination of which the case must stand or fall.
Are the plaintiffs estopped, by virtue of their charter and the purposes of their organization, from demanding an account from the defendant for their property?
1. Is the Act of the Legislature incorporating this company (because beneath the cover of the statute there lurks some enterprise illicit in its object and hostile in its nature to the United States) ipso facto void? I hold that upon sound principles of construction, the law-making powers or the legislative bodies of the States could well have exercised all legislative powers and done all things deemed proper by such bodies, so far as the Federal government was concerned, not prohibited by the Constitution of the United States, and no Article in the Constitution can be pointed to which prohibits a State Legislature from incorporating a steamship company. I need only to refer to Section 10 of Article I of the Constitution, containing prohibitions upon the powers of the States; among others, that ‘ no State shall enter into any treaty, alliance or confederation, make anything but gold and silver a legal tender, pass any bill of attainder, ex post facto law, or law impairing the obligation of contracts; no State shall, without consent of Congress, lay any imposts or duties,’ & c. It will be seen from these clauses that government powers are alluded to-powers to be exercised by organized governments, having independent spheres of action within the limits of the territory to which they belong, and acting in these spheres, not by virtue of their relation to or connection with the United States government, but by virtue of their own inherent vitality, or, more properly, in accordance with the American idea of a government, by virtue of powers derived from the people, by which they were created, and from which they derive their existence. It follows, that the fact of the normal relations of the State of South Carolina to the United States were temporarily suspended during the war, could not have the effect to render void an act of her Legislature not patently hostile to the United States and infringing the domain of its exclusive dominant powers. The Supreme Court of the United States, in the case of Lane County vs. Oregon , 7 Wallace, says: I hold, as beyond all question, that the charter of the Chicora Company was valid.
Admitting that the company did use its steamers in exporting produce to neutral territory, and importing stores and supplies within the Confederate States,-in other words did engage in running the blockade,-was the company, in consequence of such acts, outlawed and deprived of all legal status whatever? I believe that there is no penalty attached to running the blockade beyond seizure and confiscation of the vessel and property taken in the attempt. The attemptors must be caught in flagrante delicto . This I must regard as undisputed, until shown some special Act of Congress affixing other penalties.
Suppose a citizen of the Confederate States had owned vessels and sent them out on a blockade-running expedition,-what effect would the enterprise have upon the legal status of the citizen? It certainly would not annul any contracts made by him with other citizens of the country wherein he was residing, no more than a purchase by an individual of cotton within the Confederate States for the purpose of shipping it through the blockade could impart to it a hostile character or subject it to forfeiture until the enterprise of running the blockade had begun, and, if taken in the act, forfeiture would ensue. The capture could have no retroactive effect upon the contract or purchase of the cotton, nor render the purchaser amenable to any tribunal for any violation of law. Unless the Act of incorporation of plaintiff was null and void, as an act done in hostility to the United States, there is no difference between a purchase of cotton by this steamship company, destining it for some neutral port, through the blockade, and the same thing being done by a private citizen. To hold a contrary doctrine would be to concede the power of the government to arrest and punish all violations of the blockade after the cessation of hostilities, either by confiscation of goods or personal infliction of penalty, without any authority from Congress justifying the imposition. And I believe I am warranted in stating it as a matter of fact, that the arrest and confinement of one or two of the Presidents of these companies after hostilities had ceased was predicated upon a violation of the revenue laws and intended to coerce the payment of whatever customs the government had been defrauded of in their importations. And even these proceedings, instituted by arbitrary arrests and other irregular process, were subsequently abandoned by the authorities. I don't know of an instance where parties who had violated the blockade during the war have been visited with personal penalties. Not even were the ships engaged in such enterprises seized by the government; and if these were clothed with exemption, unless taken in the attempt to break the blockade, a fortiori other property, not directly connected with the blockade, must be exempt. There is no proof before me that this cotton, purchased and left by the company in the hands of their agent, the defendant, was destined to go through the blockade. The intention seems to have been the reverse; for it was left and stored in Laurens, and there kept until the close of the war, many miles out of the reach of any blockade-running vessel.
If it was not competent for the government, after the war, to seize and confiscate these 250 bales of cotton as the property of this company, by what process of reasoning can this defendant be justified in appropriating it to his own use? Even if, by any stretch of interpretation, it should be held, that purchased as this cotton was by these parties imparted to it a hostile character in relation to the government, it certainly could bear no such impress in its relation to the defendant, who was the fiduciary agent of the plaintiffs. If I have not been misinformed, the proceeds of certain cotton which had been seized by the Treasury agents at the close of the war and subsequently claimed by parties citizens of the seceded States and stockholders in these steamship companies was...
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