Leonard v. Nye

• Decision Date: 21 October 1878
• Citation: 125 Mass. 455
• Parties: Elisha C. Leonard, assignee, v. William F. Nye
• Court: United States State Supreme Judicial Court of Massachusetts Supreme Court

125 Mass. 455

Elisha C. Leonard, assignee, v. William F. Nye

Supreme Court of Massachusetts

October 21, 1878

Argued October 25, 1877

Bristol. Contract for money had and received. At the trial in the Superior Court, before Aldrich, J., without a jury, the following facts appeared:

On February 19, 1868, the defendant was duly adjudged a bankrupt under the laws of the United States by the District Court of the United States for the District of Massachusetts, and on March 13, 1868, the plaintiff was duly chosen assignee of the defendant's estate, and a legal assignment thereof was made to him by that court.

On October 6, 1868, the plaintiff presented a petition to the District Court, representing that, "in order to settle his accounts with said estate, it is necessary to dispose of certain choses in action, consisting of certain bills, notes and accounts, nominally of the value of about one thousand dollars, but in reality nearly worthless," and therefore asking leave to sell the same at private sale, with or without public notice, as he might judge expedient. Upon the recommendation of a register in bankruptcy, the District Court passed an order granting this petition. And the plaintiff sold those assets as above described.

On January 14, 1875, the defendant presented to the Court of Commissioners of Alabama Claims a petition for damages sustained by the destruction of merchandise belonging to him on board the whaling barque Abigail, destroyed with her cargo on May 27, 1865, by the insurgent cruiser Shenandoah, after her departure from Melbourne, Australia. Upon that petition that court, on April 5, 1876, awarded to the defendant the sum of $ 1088.35 and interest, amounting in all to $ 1507.61 which, less $ 188.45, the expense of recovering the same, was paid to the defendant on September 15, 1876. The plaintiff filed no petition in the court; and this claim was not disclosed by the defendant in his schedule in bankruptcy, and was not known to the plaintiff until after the award, and he then demanded the sum of the defendant.

The plaintiff put in evidence the Treaty of Washington between the United States and Great Britain, promulgated July 4, 1871; the award of the Tribunal of Arbitration at Geneva, made September 18, 1872; and the act of Congress of June 23, 1874, creating the Court of Commissioners of Alabama Claims. The defendant cited the Treaty of Washington; the several acts of Congress relating to the Court of Commissioners and to the payment of its awards; the act of Congress of February 26, 1853, concerning the transfer of claims against the United States; the publications of the Department of State of the United States relating to the Geneva Arbitration, and the debates in Congress regarding the Geneva Award; and it was agreed that they might be referred to at the argument.

Upon this evidence, the defendant asked the court to rule that the plaintiff could not recover; that the claim described in the defendant's petition to the Court of Commissioners of Alabama Claims did not pass by the assignment and proceedings in bankruptcy; and that, if it did so pass, the plaintiff had sold and assigned the same. But the judge declined so to rule; and ruled that that claim did pass by the assignment in bankruptcy, and the plaintiff could recover; and found, and ordered judgment, for the plaintiff in the sum of $ 1386.88. The defendant alleged exceptions.

Exceptions overruled.

C. W. Clifford, for the defendant.

E. L. Barney, for the plaintiff.

Gray, C. J. Lord & Soule, JJ., absent.

OPINION

Gray, C. J.

This case presents the question, whether money paid by the United States according to a decision of the Court of Commissioners of Alabama Claims, under the act of Congress of June 23, 1874, to the owner of a cargo destroyed in 1865 by one of the insurgent cruisers, with respect to which it was determined by the award made at Geneva by the Tribunal of Arbitration, constituted by virtue of the Treaty of Washington of 1871, that Great Britain had failed to fulfil her duties as a neutral government, belongs to an assignee of such owner, appointed under the bankrupt act of 1867, after the destruction of the property, and before the making of the treaty.

The leading American authority upon this subject is Comegys v. Vasse, 1 Pet. 193. In 1802, Vasse, who had previously been an underwriter on ships and cargoes, the property of citizens of the United States, captured and carried into the ports of Spain and her dependencies, and who had received abandonments from the owners and had paid them the losses caused by such captures, was proceeded against as a bankrupt under the act of Congress of April 4, 1800, and an assignment of his property was made to Comegys and others as his assignees in bankruptcy. By the treaty with Spain of 1819, by which Florida was ceded to the United States, the United States renounced all claims of their citizens upon the government of Spain for such captures, and undertook to make satisfaction, to an amount not exceeding five millions of dollars, for the same as ascertained by commissioners appointed by the President to receive, examine and decide upon the amount and validity of all such claims. 8 U.S. Sts. at Large, 258, 260. In 1821, Congress authorized such commissioners to be appointed, conformably to the stipulations of the treaty. 3 U.S. Sts. at Large, 639. In 1824, the assignees in bankruptcy of Vasse received from the treasury of the United States about nine thousand dollars, being the sum awarded by the commissioners on account of the captures and losses of the vessels and cargoes insured by Vasse; and Vasse afterwards brought an action of assumpsit against his assignees to recover this sum.

The Supreme Court of the United States, in an opinion delivered by Mr. Justice Story, unanimously held, 1st. That the decision of the commissioners was not conclusive of the right of the assignees to hold against the bankrupt the money awarded to them; 2d. That the abandonment by the owners of the ships and cargoes to Vasse, the underwriter thereon, assigned not only the property itself, or its proceeds if restored after an unjust capture, but also any compensation awarded by way of indemnity therefor, and, consequently, that the sum awarded by the commissioners belonged to Vasse, if it had not passed by assignment from him; and also by a majority of the court (overruling the decision of Mr. Justice Washington on the circuit, reported 4 Wash. C. C. 570,) decided that this right of Vasse had passed by the assignment in bankruptcy to his assignees, and therefore he could not maintain the action against them.

The grounds of the decision upon the first point may be summed up thus: The authority of the commissioners and the effect of their award were limited to ascertaining and determining the validity and amount of the original claims for damages and injuries against Spain. The determination of that question did not require the commissioners, and the powers conferred upon them did not permit the summoning in of the necessary parties and witnesses to enable them, to adjust the conflicting rights of different citizens in the fund awarded, or to decide who was the original legal, as contradistinguished from the equitable, owner, or whether the present ownership was in assignees, personal representatives, or bona fide purchasers. But the rights of any claimant, as well as of all other persons, in the sum awarded to him by the commissioners, were left to the ordinary course of judicial proceedings in the established courts, where redress could be administered according to the nature and extent of the rights or equities of all the parties. 1 Pet. 212, 213. A similar decision was afterwards made by the same court as to an award of the commissioners under the treaty with France of 1831, and the act of Congress of 1832 to carry that treaty into effect. 8 U.S. Sts. at Large, 430. 4 U.S. Sts. at Large, 574. Frevall v. Bache, 14 Pet. 95.

The reasons assigned in Comegys v. Vasse for the decision upon the second point bear so strongly upon the case before us, as to make it proper to state them more fully, which cannot be better done than by quoting some passages from the opinion.

"In general, it may be affirmed, that mere personal torts, which die with the party, and do not survive to his personal representative, are not capable of passing by assignment; and that vested rights ad rem and in re, possibilities coupled with an interest, and claims growing out of, and adhering to property, may pass by assignment." "The law gives to the act of abandonment, when accepted, all the effects, which the most accurately drawn assignment would accomplish." "Whatever may be afterwards recovered or received, whether in the course of judicial proceedings or otherwise, as a compensation for the loss, belongs to the underwriters." Both upon authority and upon principle, "the right to the compensation in this case was in its nature assignable, and passed by abandonment to Vasse." "The right to indemnity for an unjust capture, whether against the captors or the sovereign, whether remediable in his own courts, or by his own extraordinary interposition and grants upon private petition, or upon public negotiation, is a right attached to the ownership of the property itself, and passes by cession to the use of the ultimate sufferer. If so assignable to Vasse, it was equally, in its own nature, capable of assignment to others; and the only remaining inquiry would be, whether it had so passed by assignment from him."

"It is not universally, though it may ordinarily be one test of right, that it may be enforced in a court of justice. Claims and debts due from a sovereign are not ordinarily capable of being so enforced. ...