Rea v. Missouri

• Decision Date: 01 October 1873
• Citation: 21 L.Ed. 707,17 Wall. 532,84 U.S. 532
• Parties: REA v. MISSOURI
• Court: U.S. Supreme Court

84 U.S. 532

21 L.Ed. 707

17 Wall. 532

REA v. MISSOURI.

October Term, 1873

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

The First National Bank of Washington, D. C., in 1869, having a judgment against one Perry Fuller, who had been a large dealer with the Indians on the Western frontier, having more than one trading-place there, levied on certain goods at St. Louis, in Missouri, which they alleged to be his. One Hayes, however, claimed them; and the sheriff refusing to go on with his levy unless indemnified, the bank, along with Rea and another, in accordance with a statute of Missouri, executed a bond to the State of Missouri, conditioned that the bank should indemnify the sheriff against the seizure of the goods, and should also pay Hayes, and any person claiming title to the property, for all damages which they should sustain in consequence of such seizure and sale.

The sheriff hereupon sold the goods under the attachment, and thereupon an action was brought in the name of the State of Missouri on the relation and to the use of Hayes against the sureties in the bond, Rea, and the other; the suit, of course, being in fact, one by Hayes, for an illegal seizure and sale of his goods.

The bank set up that the goods belonged to Fuller, and that the purchase of them by Hayes was a simulated and fraudulent one, and was in truth made for the benefit of Fuller.

The great question on the trial was whether there was or was not a fraudulent scheme between the two persons, by which the goods in question were to be purchased in Hayes's name, but in secret trust for the use and benefit of Fuller, wholly or in part.

In the course of the trial Hayes, the virtual plaintiff, was placed on the stand, by his own counsel, to show the value of the goods in question, and the fact that he had purchased them on his own account alone. His cross-examination was very long, covering fifty pages of the printed record, and took a wide range. It appeared on this cross-examination that in 1865 he had been a clerk in the Indian Department at a salary of $1500, and had a wife and child, and that these goods were bought in 1869, and had cost about $24,000, being bought partly for cash and partly on credit. To explain his ability to make a purchase, in either way, on so considerable a scale, the witness having stated that in 1865 some four years before the goods were bought—he was worth $45,000, he was asked how he had acquired that sum. As to a portion of it he stated that he had advanced money,—sometimes $3000 or $4000, and from that to $6500 at a time,—to a third person to buy up government vouchers on speculation; and that he and this person had shared, share and share alike in the profit.

The record then disclosed the following dialogue:

Counsel for the defendants (to the witness):

Question. To whom did you lend this money to buy Indian vouchers?

Answer. To a friend of mine.

Question. Who was it?

Answer. If the court requires I shall tell the name, not without.

Question. You decline to answer?

Answer. If the court requires it, I will answer.

The Court. If there is some reason why he does not wish to disclose the name, the court will not oblige him to do it.

Counsel for the defendants. The witness might answer the questions; they are very short.

The Court. He may have personal reasons why he does not choose to name the parties; if so, I won't press him.

Counsel for the plaintiff. Suppose the man was an officer of the government, and made himself criminally liable?

Counsel for the defendants. Then let the witness state it.

The Court. If there are personal reasons why the witness does not choose to answer, he need not state it.

Witness. I prefer not to give it.

And thereupon, no answer being given, an exception was noted.

Hayes also stated in his cross-examination, that Fuller & Co. and McDonald & Fuller, firms dealing with the Indians, and in which Perry Fuller was interested, were indebted to him for services rendered to them in certain contracts which they had with the government in 1866, and that they had paid him large amounts on that account, a matter which the defendants denied to be true.

The goods had been purchased at New York by Hayes, and the bills made and the goods shipped to St. Louis in his name alone.

A great mass of evidence of a circumstantial character was taken on the subject, showing the history and character of the connection between Hayes and Fuller; and as the defendants contended, tending to prove that Hayes was a mere tool of Fuller's, in this as well as other transactions. It was shown that Hayes had been in intimate relations with Fuller previously to this purchase; that Fuller, though a dealer with the Indians, and in the West, was much in Washington, and that Hayes, as already said, was a clerk in the Indian Department in that city, and that the two persons were acquainted in this manner in 1861; that Fuller being afterwards, 1868, appointed revenue collector at New Orleans, Hayes was appointed an appraiser under him, with a salary of $1800; that in the matter of the purchase of the goods levied on, Fuller recommended Hayes as a purchaser of them, certified to his responsibility, indorsed his notes for a part of the purchase-money, and pledged his wife's securities as collateral to a portion thereof. A great variety of other evidence of many kinds was given tending, as the counsel of the defendants conceived, to show intimacy and collusion. Amongst this evidence were various declarations of both Hayes and Fuller, made at different times, as well when they were together as when they were not.

The testimony being closed the circuit judge charged the jury thus:

'If you find from the evidence that Hayes was the sole owner of the goods, and that Fuller had no interest or right of property therein, then the bank had no right to levy its attachment upon them, and the defendants are liable to the plaintiffs for their damages.

'But if you find that Fuller owned the property attached, or was a copartner, though a secret copartner with Hayes in respect to said goods, or had a joint interest in them, then, in either case, the bank had a right to attach the goods, and the defendants are not liable in this action; and in this action are not liable although Hayes, as between himself and Fuller, may have had a joint interest, with Fuller, in the goods.'

After stating that the goods were purchased in New York in the name of Hayes, and that the bills were made to him, and that prim a facie, therefore, the goods would be Hayes's, the learned judge added:

'But the bank asserts that, although the goods were thus purchased ostensibly or apparently in the name of Hayes, yet that the purchase was in pursuance of a secret agreement or understanding between Hayes and Fuller, to the effect that Hayes should buy, in his own name, but for Fuller's benefit and use, or for the joint use and benefit of Hayes and Fuller, and that the motive or inducement for this arrangement or understanding was that Fuller was in embarrassed circumstances, or was apprehensive of trouble if his name was known in the purchase. In other words, the bank alleges that there was a fraudulent scheme between Fuller and Hayes, by which goods were to be purchased in Hayes's name, but in secret trust for the use and benefit of Fuller wholly or in part.'

The learned judge then told the jury that the alleged fraudulent scheme might be established by circumstances; that it was not necessary to establish it by express or positive testimony; and after other pertinent remarks, not now material to be stated, the case was submitted.

The jury having remained out until the next morning failed to agree, and returned into court, when they were again charged by the district judge, then holding a Circuit Court, as follows:

['If the property in question was bought and shipped solely in the name of Hayes, then the jury should find the ownership to be exclusively his, unless the defendants have proved that notwithstanding such purchase and shipment, the fact really is that the ostensible and apparent ownership of Hayes was to cover up and conceal a proprietary interest of Fuller in the goods. In other words, the possession of the goods by Hayes, the same having been bought and shipped solely in his name, throws upon the defendants the burden of proving that Fuller had a property interest therein, or was part owner thereof.]

['The defendants, in proving a secret or other agreement or understanding between Hayes and Fuller as to ownership of these goods, must first establish that fact by competent evidence, independent of any declarations or statements by Fuller in the absence of Hayes.]

['In order to prove such understanding, the defendants cannot resort to such declarations or statements by Fuller; hence, discarding from your minds on that branch of the inquiry all statements made by Fuller in the absence of Hayes, you should first determine whether such an understanding existed. If it did not exist, or is not proved by testimony independent of such statements by Fuller, then the jury cannot consider such statements by Fuller as any evidence whatever in this case. If satisfied by such independent evidence that such an understanding existed, then Fuller's declarations are competent testimony, and not otherwise.]

['It is immaterial as to the ownership of the goods how Hayes acquired his means, or whether his exhibit of his means was correct or not, if he actually bought the goods solely for himself. The merchants of whom he bought, if the purchase was based on false representations, had their legal redress, but the defendants cannot impair the title on such grounds;] that testimony it is proper for the jury to consider in reference to the credibility of Hayes as a witness, and also as tending to show what connection, if any, Hayes had at the time with Fuller, and so with respect to the manner in which he acquired...