United States v. Carl Chamberlin

• Decision Date: 03 January 1911
• Docket Number: No. 77,77
• Citation: 219 U.S. 250,55 L.Ed. 204,31 S.Ct. 155
• Parties: UNITED STATES, Plff. in Err., v. CARL S. CHAMBERLIN, D. H. Rice, and Tyson S. Dines, as Executors of the Last Will and Testament of Winfield Scott Stratton, Deceased, Defendants in Error
• Court: U.S. Supreme Court

219 U.S. 250

31 S.Ct. 155

55 L.Ed. 204

UNITED STATES, Plff. in Err.,

v CARL S. CHAMBERLIN, D. H. Rice, and Tyson S. Dines, as Executors of the Last Will and Testament of Winfield Scott Stratton, Deceased, Defendants in Error.

No. 77.

Argued December 16, 1910.

Decided January 3, 1911.

This case comes here on certiorari. The action was brought by the United States, in the district court of the United States for the district of Colorado, against the executors of the estate of Winfield Scott Stratton, deceased, to recover the amount of stamp taxes claimed to be payable under the war revenue act of June 13, 1898. [30 Stat. at L. 448, chap. 448, U. S. Comp. Stat. 1901, p. 2286.]

The plaintiff alleged that in May, 1899, Stratton had conveyed to a corporation known as Stratton's Independence, Limited, certain lands in the state of Colorado by deed reciting a consideration of $4,850,000; that internal revenue stamps of the value of $4,850 were affixed to the deed, whereas the actual consideration of the conveyance and the value of the lands was $9,733,000, and by reason thereof there became due and payable to the United States from Stratton a revenue tax amounting to $9,733, of which the sum of $4,833 remained unpaid, internal revenue stamps therefor not having been attached to the deed or canceled; that the Collector of Internal Revenue of the United States for the district of Colorado had reported the facts to the Commissioner of Internal Revenue, who had determined that the sum of $9,733 should have been paid, and demand for payment having been made and refused, the said Commissioner had directed suit be instituted.

The district court sustained a general demurrer to the complaint, and its judgment was affirmed by the circuit court of appeals.

The applicable provisions of the war revenue act of June 13, 1898, chapter 448 (30 Stat. at L. pp. 448-470; 2 U. S. Rev. Stat. Supp. pp. 779-804, U. S. Comp. Stat. 1901, pp. 2286-2311), are set forth in the margin, together with the amendment to § 13, made by the act of March 2, 1901, chapter 806 (31 Stat. at L. 941, U. S. Comp. Stat. 1901, p. 2296).

"Sec. 6. That on and after the first day of July, eighteen hundred and ninety-eight, there shall be levied, collected, and paid, for and in respect of the several bonds, debentures, or certificates of stock and of indebtedness, and other documents, instruments, mat- Assistant Attorney General Denison and Mr. Barton Corneau for plaintiff in error.

[Argument of Counsel from pages 252-257 intentionally omitted] the original be lost, to a copy thereof. But no right acquired in good faith before the stamping of such instrument, or copy thereof, as herein provided, if such record be required by law, shall in any manner be affected by such stamping as aforesaid.'

The foregoing section (§ 13) was amended by the act of March 2, 1901, chapter 806 (31 Stat. at L. 941, U. S. Comp. Stat. 1901, p. 2296), by striking out the words 'schedule A of' in the fourth line of the section as above quoted, and also by inserting in the first proviso after the words 'bonds, debentures, or certificates of stock or of indebtedness,' the words 'or any instrument, document, or paper of any kind or description whatsoever, mentioned in schedule A of this act.'

'Sec. 14. That hereafter no instrument, paper, or document required by law to be stamped, which has been signed or issued without being duly stamped, or with a deficient stamp, nor any copy thereof, shall be recorded or admitted, or used as evidence in any court until a legal stamp or stamps, denoting the amount of tax, shall have been affixed thereto, or prescribed by law. . . .

'Sec. 15. That it shall not be lawful to record or register any instrument, paper, or document required by law to be stamped unless a stamp or stamps of the proper amount shall have been affixed and canceled in the manner prescribed by law; and the record, registry, or transfer of any such instruments upon which the proper stamp or stamps aforesaid shall not have been affixed and canceled as aforesaid shall not be used in evidence.

* * * * *

* 'Sec. 25. That the Commissioner of Internal Revenue shall cause to be prepared for the payment of the taxes prescribed in this act suitable stamps denoting the tax on the document, article, or thing to which the same may be affixed, and he is authorized to prescribe such method for the cancelation of said stamps, as substitute for or in addition to the method provided in this act, as he may deem expedient. The Commissioner of Internal Revenue, with the approval of the Secretary of the Treasury, is authorized to procure any of the stamps provided for in this act by contract whenever such stamps cannot be speedily prepared by the Bureau of Engraving and Printing; but this authority shall expire on the first day of July, eighteen hundred and ninety-nine. That the adhesive stamps used in the payment of the tax levied in schedules A and B of this act shall be furnished for sale by the several collectors of internal revenue, who shall sell and deliver them at their face value to all persons applying for the same, except officers or employees of the internal-revenue service: Provided, That such collectors may sell and deliver such stamps in quantities of not less than one hundred dollars of face value, with a discount of one per centum, except as otherwise provided in this act. And he may, with the approval of the Secretary of the Treasury, make all needful rules and regulations for the proper enforcement of this act.

SCHEDULE A.

Stamp Taxes.

* * * * *

'Conveyance: Deed, instrument, or writing, whereby any lands, tenements, or other realty sold shall be granted, assigned, transferred, or otherwise conveyed to, or vested in, the purchaser or purchasers, or any other person or persons, by his, her, or their direction, when the consideration or value exceeds one hundred dollars and does not exceed five hundred dollars, fifty cents; and for each additional five hundred dollars or fractional part thereof in excess of five hundred dollars, fifty cents.

* * * * *

'Sec. 31. That all administrative, special, or stamp provisions of law, including the laws in relation to the assessment of taxes, not heretofore specifically repealed, are hereby made applicable to this act.'

Messrs. D. P. Strickler and P. H. Holme for defendants in error.

[Argument of Counsel from Page 257 intentionally omitted] Mr. Justice Hughes, after making the foregoing statement, delivered the opinion of the court:

The question presented is whether an action lies by the United States to recover the amount of a stamp tax payable under the war revenue act of 1898 upon the execution of a conveyance.

If the statute creates an obligation to pay the tax, and does not provide an exclusive remedy, the action must be regarded as well brought.

At comon law, customs duties were recoverable by the Crown by an information in debt or an exchequer information in the nature of a bill in equity for discovery and account. These informations rested upon the general principle 'that in the given case the common law or the statute creates a debt, charge, or duty in the party personally to pay the duties immediately upon the importation; and that therefore the ordinary remedies lie for this, as for any other acknowledged debt due to the Crown.' United States v. Lyman, 1 Mason, p. 499, Fed. Cas. No. 15,647. See also Comyn's Dig. (title 'Debt' A, 9); Atty. Gen. v. Stranyforth, Bunbury, 97; Atty. Gen. v. Weeks, Bunbury, 223; Atty. Gen. v. Jewers, Bunbury, 225; Atty. Gen. v. Hatton, Bunbury, 262.

Applying this principle, it was held in the Lyman Case, supra, and in Meredith v. United States, 13 Pet. 486, 10 L. ed. 258, that the government was entitled to maintain an action to recover duties upon imports as a personal indebtedness of the importers. The duty to pay was there derived from the language of the act of April 27, 1816, chap. 107 (3 Stat. at L. p. 310), that 'there shall be levied, collected, and paid' the several duties mentioned, and in accordance with an established rule of interpretation the charge of the duty on the goods was taken to mean a personal charge against the owner. In the case last cited the court, by Mr. Justice Story, said (p. 493):

'The first question is whether Smith and Buchanan were every personally indebted for these duties; or, in other words, whether the importers of goods do, in virtue of the importation thereof, become personally indebted to the United States for the duties due thereon; or the remedy of the United States is exclusively confined to the lien on the goods, and the security of the bond given for the duties. It appears to us clear upon principle, as well as upon the obvious import of the provisions of the various acts of Congress on this subject, that the duties due upon all goods imported constitute a personal debt due to the United States from the importer (and the consignee for this purpose is treated as the owner and importer), independently of any lien on the goods, and in any bond given for the duties. The language of the duty act of the 27th of April, 1816, chap. 107, 3 Stat. at L. 310, under which the present importations were made, declares that 'there shall be levied, collected, and paid' the several duties prescribed by tha act on goods imported into the United States. And this is a common formulary in other acts laying duties. Now, in the exposition of statutes laying duties, it has been a common rule of interpretation, derived from the principles of the common law, that where the duty is charged on the goods, the meaning is that it is a personal charge on the owner by reason of the goods. So it was held in Atty. Gen. v. _____, 2 Anstr. 558, where a duty was laid on wash in a still; and it was said by the court that where duties are charged on any articles in a revenue act, the word 'charged' means that the owner shall be debited with the sum; and that this rule prevailed...