Eyster v. Centennial Board of Finance

• Decision Date: 01 October 1876
• Parties: EYSTER v. CENTENNIAL BOARD OF FINANCE
• Court: U.S. Supreme Court

94 U.S. 500

24 L.Ed. 188

EYSTER v. CENTENNIAL BOARD OF FINANCE.

October Term, 1876

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

The facts are stated in the opinion of the court.

Mr. Assistant Attorney-General Smith and Mr. William M. Springer for the appellant.

Mr. William Henry Rawle and Mr. Robert N. Willson, contra.

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

This case presents the single question whether, in the distribution of the moneys remaining in the treasury of the Centennial Board of Finance at the close of the affairs of that corporation, as provided for in sect. 10 of the act of June 1, 1872, the appropriation of $1,500,000 made by Congress in the act of Feb. 16, 1876, must be paid into the treasury of the United States before any division of assets is made among the stockholders in satisfaction and discharge of the capital stock.

It is very apparent that the object of Congress, in all its legislation with reference to the Centennial Exhibition, was to enable the people of the United States to commemorate 'the completion of the first century of their national existence' by an exhibition 'in which the people of the whole country should participate,' and which should have the sanction of the government. In that sense, the object was national; but it is equally clear, that, until the act of 1876, it was expected that the entire expense would be borne by the people without assistance from Congress. Certainly, no pecuniary liability whatever was assumed by Congress. That is declared in the most positive terms.

The acts of 1871 and 1872 did nothing more than provide the necessary organizations through which the people might operate under the auspices of the government. That of 1871 authorized the appointment of the board of commissioners, which was afterwards, by the act of 1872, incorporated as the 'United States Centennial Commission.' The duty of this board was to prepare and superintend the execution of a plan for holding the exhibition. That of 1872 was specially intended to provide a way by which the people could procure the necessary funds. It was so expressly declared in the preamble; and for that purpose the Centennial Board of Finance was incorporated, with apt provisions for subscription to and sale of its capital stock, and for the control and management of its affairs. The proceeds of the stock, together with the receipts from all other sources, were to be used by this corporation for the erection of buildings with their appurtenances, and for all other expenditures required in carrying out the objects of the act of 1871. Then, by sect. 10, it was provided, 'that, as soon as practicable after the said exhibition shall have been closed, it shall be the duty of said corporation to convert its property into cash, and, after the payment of its liabilities, to divide i § remaining assets among its stockholders, pro rata, in full satisfaction and discharge of its capital stock.'

Afterward came the act of 1876, which made the appropriation now under consideration, 'to complete the . . . buildings and other preparations,' and directed its payment to the president and treasurer of the Centennial Board of Finance for that purpose, but which contained a proviso, 'that in the distribution of any moneys that may remain in the treasury of the Centennial Board of Finance after the payment of its debts, as provided for by the tenth section of the act of Congress approved June 1, 1872, incorporating the Centennial Board of Finance, the appropriation hereinbefore made shall be paid in full into the treasury of the United States before any dividend or percentage of profits shall be paid to the holders of said stock;' and 'that the government of the United States shall not, under any circumstances, be liable for any debt or obligation of the United States Centennial Commission or the Centennial Board of Finance, or any payment in addition to the foregoing sum.'

The whole controversy arises upon this proviso. On the one hand, it is contended that it requires the repayment to the United States of the full amount of their appropriation before any distribution can be made to the stockholders; and, on the other, that the stockholders must be reimbursed for their stock subscriptions before any payment is made to the United States. It becomes necessary, therefore, to ascertain the intention of Congress in this particular, and for that purpose the acts of 1871, 1872, and 1876, being in pari materia, are to be examined and construed together.

There is no doubt but that the act of 1876 appropriated public moneys for the completion of the centennial buildings and other preparations. Neither is there any doubt that, under certain circumstances, the Centennial Board of Finance was required to pay back to the treasury of the United States the full amount of the appropriation. The corporation assumed such an obligation by taking the money upon the conditions imposed. If this did not create a debt, technically so called, it certainly did create a liability. The act of 1872 provided for a division of the assets of the corporation among the stockholders, only after the payment of all liabilities; and, unless the contract entered into otherwise directs, it would seem so be clear, that, so far as that act is concerned, the United States must be paid in full before the stockholders can claim any distribution among themselves.

In the act of 1876, the language is somewhat different. By that the United States are to be paid out of the moneys that remain in the treasury of the company, after the payment of the debts. If this were all, the intention would be manifest. The liability of a corporation to its stockholders on account of their stock is not a debt. The...