1 Story 135 | U.S. Circuit Court for the District of Massachusetts | 1840
Upon this bill of exceptions the questions, which have been argued at the bar, are: (1) Whether the evidence, as above stated, was properly admitted at the trial by the learned district judge. (2) Whether the points of law ruled by him, as to the effect of fraud and collusion in obtaining the permit, were correctly ruled.
In respect to the evidence admitted at the trial, assuming that the other points are in favor of the United States, I am clearly of opinion that the whole of it was admissible to substantiate the fraud. It divides itself into four heads: (1) The evidence tending to prove the conspiracy and fraud and collusion of the claimant and the deputy collect- or, in respect to the twenty-three packages of goods, of which the goods secured were a part. It is scarcely contested, that this was proper evidence. (2) The evidence tending to prove, that the goods, imported in the Roscoe by the claimant, were imported and landed by the perpetration of a similar fraud between the same parties. (3) The evidence tending to prove, that in other cases of the importation of similar goods by other importers, the deputy collector did not select the highest cost packages, as he did in the case of the claimant, and thereby to strengthen the inference of conspiracy and fraud and collusion. (4) The evidence of the importation of other goods of the same character, cost, and value, as those imported by the claimant in the Roscoe, shipped- about the same time with those in the Roscoe, marked with the same marks, and numbered in an exact and progressive continuation of the eases of the goods of the claimant in the Roscoe; and, also, evidence, that the same goods arrived in four different shipments soon after the seizure of the claimant’s goods in the Roscoe, and before the news of the seizure could have reached England; that the same goods were not then entered at the custom house, but were entered by one William Bottomley, as being the property of James Bottomley, senior, after full knowledge of the seizure must have been known in England; and that they were then entered at a greatly enhanced price and rate beyond those imported in the Roscoe. This last evidence was avowedly offered as tending to establish two important facts: (1) That the claimant was the real owner of these shipments; (2) that the cost of the goods by the Roscoe, as entered by the claimant, was knowingly and fraudulently set forth in the entry.
The objection taken to all these three last portions of the evidence excepted to, is, that it is res inter alios acta, and upon other occasions; and therefore, not properly admissible to establish a fraud in the case of the importation of the goods now before the court. But it appears to me clearly admissible upon the general doctrine of evidence in cases of conspiracy and fraud, where other acts in furtherance of the same general fraudulent design are admissible; first, to establish the fact, that there is such a conspiracy and fraud; and, secondly, to repel the suggestion, that the acts might be fairly attributed to accident, mistake, or innocent rashness, or negligence. In most cases of conspiracy and fraud, the question of intent, or purpose, or design in the act done, whether innocent or illegal, whether honest or fraudulent, rarely admits of direct and positive proof; but it is.to be deduced from various circumstances of more or less stringency, and often occurring, not merely between the same parties, but between the party charged with conspiracy or fraud - and third persons. And in all cases, where the guilt of the party depends upon the intent, purpose, or design, with which the act is done, or upon his guilty knowledge thereof, I understand it to be a general rule, that collateral facts may be examined into, in which he bore a part, for the purpose of establishing such guilty intent, design, purpose, or knowledge. Thus, in a prosecution for uttering a bank note, or bill of exchange, or promissory note, with knowledge of its being forged, proof, that the prisoner had uttered other forged notes or bills, whether of the same or of a different kind, or that he had other forged notes or bills in his possession, is clearly admissible as showing, that he knew the note or bill in question to be forged. So the law is laid down in Mr. Phillips and Mr. Amos’s excellent treatise on Evidence, in the last edition.
There is a still stronger ground applicable to cases of this sort, which makes it incumbent upon the government to make out strong proof of conspiracy, collusion, and fraud. The charge is against a public officer of such conspiracy, collusion, and fraud, in the discharge of the duties of his office. Now, the ordinary presumption of law is in favor of the innocence of the officer, and, if I may so say, of his general character being elevated above the meanness of perpetrating an official fraud. This presumption will prevail even against circumstances of suspicion.
The other questions, which arise upon the instructions asked and refused, as well as upon those given by the learned judge of the district court, resolve themselves into these two: (1.) Whether, if the permit was obtained by a fraudulent collusion between the claimant and the deputy collector, it was utterly void. (2.) And if so void, whether the goods landed under such a permit so obtained, can be declared forfeited upon the first count, as actually framed; or whether there should have been a special count framed, stating the actual facts of the fraud, and then concluding, that so the permit was void. I say, that these are the only questions; for, upon the actual posture of the case before the court, no other questions properly arose in judgment. And if the instructions, asked by the claimant, and refused by the court, went beyond these, they were properly refused, as being abstract and irrelevant to the actual merits of the controversy, or were too vague and general to entitle the claimant to have them answered. The supreme court of the United States have often held, that it is no error to refuse instructions, asked by a party, which are open to either objection; because they may have a tendency to mislead the jury.
In the first place, then, was the permit in the present case, if obtained by fraud and collusion between the claimant and the deputy collector utterly void, so that it may be treated as a mere nullity, exactly as if there had been no permit at all for the landing of the goods? The point is, as far as I know, new with reference to the 50th section of the act of 1799, e. 128 [1 Stat. 665, c. 22]; and, therefore, it must be disposed of upon general principles and the analogies of the law. Now, the general rule certainly is, that whenever fraud intervenes in any act, contract, deed, conveyance, or other instrument, however solemn it is, it is, as to the party,, upon whom the fraud is perpetrated, or whom it is designed to injure, utterly void. If the fraud is concocted for the purpose of cheating third persons, it may bind the immedi
In the common case of a conveyance to defraud creditors, we all know, that it is valid and obligatory between the parties; because the law will not tolerate the grantor in setting up his own turpitude, to avoid his own solemn act. It leaves him to bear the burden of his own iniquity, and to submit to the loss of the property, of which he intended to cheat others, upon the known maxim, “In pari delicto melior est conditio possidentis.” As the party has made his own bed, so he must lie on it, however uneasy may be his posture. But in relation to the creditors, we all know, the same conveyance is treated as an utter nullity, and is not for a moment allowed to intercept their rights. But, take the case, where one party obtains a license, contract, obligation, conveyance, or other instrument, from another by fraud, imposition, or undue influence upon the latter, the transaction is constantly treated as a mere nullity between them. It has, in contemplation of law, no existence whatsoever. Take the case of a deed obtained from a lunatic or a drunkard, while in a state of lunacy or gross intoxication; we all know, that the deed is treated as a nullity, and non est factum is a good plea to it. Yates v. Boen, 2 Strange, 1104; Cole v. Roberts, Bull. N. P. 172;
Now, if this doctrine be true between the direct parties, acting in their own right, must it not apply with superior force to the acts of mere agents, and especially to public agents, who are acting under a limited authority prescribed by law? Suppose a private agent should, by fraud and collusion with a purchaser, sell the goods of his principal, in known violation of his orders or duty, might not the principal treat the sale as a nullity, and maintain trover for the conversion? I apprehend, that there is no doubt of that. Suppose, which is closer to the present case, the clerk of a commission merchant, having a lien upon goods for his advances and commissions, should fraudulently deliver up those goods, in connivance with the owner of them; could not the commission merchant treat the transaction as a nullity, and recover back the goods from the owner? Suppose the cashier of a bank should fraudulently and collusively deliver up to the parties any notes or securities discounted for them at the bank, or any property, lodged as a pledge or collateral security, in known violation of his duty; would not the whole proceeding be a mere nullity, and treated as such in law, to all intents and purposes? It seems to me, that no doubt could possibly exist in either of these cases.
At the argument, I put a case to the learned counsel for the claimant, to this effect. The 49th section of the collection act of 1799, c. 128 [1 Stat. 664, c. 22], requires an entry of the goods, and an estimate of the duties due thereon, to be made by the collector; and upon the estimated duties being paid, or secured to be paid, it then, and not before, authorizes the collector to grant a permit to land Them. These, therefore, are preliminaries to the grant of the permit. Suppose, there should be no entry, no esti
In respect to the other point, whether the first count, alleging, that the goods were landed without a permit, can be supported by the proof of a permit granted by fraud and collusion between the claimant and the deputy collector, it does not appear to me to involve any serious difficulty. The argument is, that the special circumstances of fraud ought to have been set forth in the count, and then the conclusion of law stated, that thereby the permit became void. But it does not appear to me, that this argument is well founded. It is a general rule in pleading, that the party may declare upon the case according to its legal effect, and that he need not set forth the particular circumstances, which bring the case within the reach of the general allegations. An action for money had and received is maintainable for money had and received or retained by fraud; and no special count is necessary. So. in the case of Anthony v. Wilson, 14 Pick. 303, already cited, it was held, and in my judgment with entire accuracy, that the party may support an issue of no license, by proof that the license set up in the case was founded in fraud. That is a case directly in point to the present objection. Whelpdale’s Case, 5 Coke, 119, has been cited to the contrary; but it does not appear to me to support it, when examined in its just bearing. The true distinction is between deeds, which are void ab initio, and deeds, which are voidable only. In the former case, the plea of non est fac-tum is entirely proper; in the latter, a special non est factum is required. Lord Ellen-borough stated the true distinction in Lambert v. Atkins, 2 Camp. 272, 273; and it was affirmed and illustrated by Mr. Justice Putnam, in Anthony v. Wilson.
It has been suggested, that parol evidence is not, and ought not to be admitted to prove fraud in making entries, or invoices of goods, or in obtaining permits, after the goods have passed from the custom house, and have undergone the regular inspection of the public officers. This is pressed upon the ground of the supposed danger and public inconvenience of such evidence, after the goods can no longer be inspected and examined, so as to justify or to repel the presumption of fraud; and the dangers to subsequent bona fide purchasers of the goods. I cannot admit the argument to be well founded in point of law. I know of no case, where parol evidence is not admissible to establish fraud, even in the most solemn transactions and conveyances. What would become of prosecutions for perjury in swearing to false invoices, if we were to exclude parol evidence to show the true cost, or the actual sworn value of the goods? What should we do in cases of fraudulent conveyances to cheat creditors, or of fraudulent deeds, procured by undue influence, or gross violence, or meditated imposition? What should we do in cases of forgery by alteration of written instruments, or of the utterance of false bank bills? The present bill of exceptions does not, indeed, raise any question of this sort; and, therefore, it is unnecessary to dwell on it. But I desire not to be understood for a single moment to doubt the entire propriety, and even necessity of allowing parol
Phil, «fe A. Ev. (Sth London Ed.) 494.
Phil, «fe A. Ev. (Sth London Ed.) 495.
Rex v. Dunn, 1 Moody, Cr. Cas. 146; Phil. & A. Ev. (8th London Ed.) 497.
King v. Hunt 3 Barn. & Ald. 566, 573.
See Somes v. Skinner, 16 Mass. 348, 360.
See U. S. v. Hayward [Case No. 15,336],
See, also, 1 Story, Eq. Jur. g 230. and note; and note to Lambert v. Atkins, 2 Camp. 272, 273.
See, also, Com. Dig. “Pleader,” W. 2, 18; 1 Chit. PI. (3d. Ed.) 479.