1 Doug. 527 | Mich. | 1845
delivered the opinion of the Court.
The present case involves the same legal principles which were so ably discussed and so fulty considered by this Court at its last January term, in another and similar case between the same parties. (Vide ante, 225.) We are now called upon to decide whether the aspect given to the present case, will authorize us in granting the relief prayed for, and which was denied in the former one, for reasons stated in an opinion which I had the honor, as the organ of the Court, to deliver.
It becomes necessary, in the first place, to state with clearness the principles established by this Court, in the case last mentioned, before entering upon the discussion of those now presented for our decision. In doing this, I have a twofold object in view: — one is, to see how far those principles are applicable to the case before us;— another is, to correct some misapprehension which seems to have prevailed respecting the scope and extent of that decision. Upon an examination of the opinion it will be found to assert the following propositions :
1. That “ the principle is well settled that while a state may sue, it cannot be sued in its own courts, unless, indeed, the state consents to submit itself to the jurisdiction of the Court.” Ante, 236.
2. That “ a person cannot be regarded as a party to a suit, who is not made one by the proceedings in the case, and does not appear in that character upon the record.” Ante, 237.
4. That the mere circumstance that a state is interested in the subject matter in controversy, does not, of itself, necessarily oust a court of jurisdiction; but such jurisdiction will be exercised in a variety of cases particularly referred to in the opinion. Ante, 238, et seq.
5. “ That the estate granted by the complainants was upon condition.” Ante, 266.
6.. “ That, whether the commissioners on the part of the state, had the authority or not, to annex the condition, cannot-affect the legal rights of the complainants under the agreement, for the reason that the state had ratified and confirmed the acts of the commissioners, and were bound by the agreement made with the complainants.” Ib.
7. “ That the condition in the last clause of the agreement was simply to indemnify.” Ib.
8. “ That there had been no breach, b,y the state, of the condition.” lb.
9. “That so much of the act of 17th February, 1842, as rejects the condition, is a nullity, and of no efficacy in the law.” Ib.
The decree of the Chancellor was affirmed in that case, because it appeared to us that the facts disclosed in the bill, did not entitle the complainants to the relief prayed for.
It is now contended by the counsel for the complainants, “that the whole case has been already determined, and that all the facts are now set up, which bring the case •within the principles of the decision of the Court last
I have been induced to be thus particular in stating what was actually decided by this Court, at the last January term, for another reason : A volume of the reports of the Court of Chancery, now in the course of publica^ tion, having been put into my possession, I observed a note, appended by the Chancellor to his decision in that case, commenting upon the opinion of this Court, and in which, it is said, that the Supreme Court held that the Chancellor had jurisdiction of the case, “and consequently that it was competent for him to have given relief against the state, if complainants had made out a proper case by their bill; that is, had shown themselves damnified by being compelled to pay off the bond and mortgage which the commissioners agreed the state should pay. And Osborn v. The Bank of the United States, 9 Wheat. R. 738, noticed by the Chancellor in the concluding part of his opinion, was relied on by the Supreme Court, to show the jurisdiction of the Chancellor. They appear, however, to have overlooked the broad distinction between the two cases, viz: that one was a case of tort, and the other of contract. They admitted that the state could not be sued, and yet held the Court had jurisdiction to enforce a contract against the state, in a suit to which the state was not so much as a party. In Osborn v. The Bank of the United States, the bank sought relief on the ground that the act of the legislature, under which the officers of the state had acted, was unconstitutional and void; and on that ground, and no other, obtained relief. The acts of a state officer, when unauthorized by the constitution and laws of the state, though done in the name of the state, are his individual acts, for which he alone, in his individual .capacity, and not the state, is responsible. Such acts are the
I have thought it proper to refer to this criticism of the Chancellor, lest our silence might be construed into an acquiescence in its justice. We lay no claim to infallibility, but feel bound to see that our opinions, upon questions so important, should not be perverted; and especially, that we should not appear to have entertained and expressed opinions so palpably absurd as those imputed to us. In these remarks I do not intend, as a matter of course, to impute any intentional misrepresentation of my views, to the Chancellor, whose high character is sufficient to shield him against such an imputation. But, admitting his right to criticise the opinions pronounced by this Court, in the mode adopted by him, we have no other means left of correcting any errors that may lurk in such criticism, than to expose them in such manner as will be most likely to set ourselves right before the public.
With these preliminary remarks, I shall now proceed to consider the only question which, in my opinion, is presented for our decision. Will this Court, upon the facts appearing in the bill and answer, direct that the assets now in the hands of the defendants be applied towards the payment of the damages suffered by the complainants, in consequence of the failure of the state to indemnify them according to the terms of the agreement recited in the bill? I have reconsidered, with much care, the opinion of this Court pronounced at the last January term, and find no reason for receding from the views we expressed on that occasion. With respect to the question of jurisdiction, which is again pressed upon our notice by the learned counsel in behalf of the defendants, I have to re
What was the legal effect of the neglect or refusal of the state to indemnify the complainants against the judgment rendered against them, on one of the bonds mentioned in the condition of the agreement entered into between the parties, which judgment the complainants aver they have paid ? This question was answered by us in the opinion delivered at the last January term of this Court. The estate assigned to the state reverted to the complainants. If so, they are the legal owners of that estate, and are entitled to the remedy which the law affords to reduce it to possession. If this view be correct, the possession of the assigned property by the state officers, is not the possession of the slate. They no longer hold it, as is contended in the answer, by virtue of the act of the 17th February, 1842. That act conferred a lawful authority on those officers to dispose of the assigned property for the purposes therein set forth, so long as the state itself had the right to that property ; but, when the state, Iny its own voluntary act, becomes divested of all right to the property, — when it becomes in fact and in law the property of the complainants, it cannot be said that the possession of the defendants is the possession of the state. That possession, although lawful at the time of the passage of the act, became unlawful when the state forfeited the estate granted to them, by a breach of the condition upon which that estate was granted. Any control over, or dis
To illustrate my views: Suppose an action for money had and received is commenced by the complainants against the defendants, to recover a sum of money now in their hands, and received by them on one of the securities assigned by the complainants to the state; who can doubt the result? The condition upon which the security was assigned being broken, the right of the state to collect and hold the money is forfeited, and the complainants are permitted to resume rights which they parted with, not absolutely, but conditionally. A court of law would not, for a moment, listen to a defence founded on the allegation that the defendants are state officers, acting by state authority, and are, therefore, protected by their connexion with their principal. The answer to such a defence would be, that, as the state had no legal interest in the subject matter in controversy, they are not a necessary party to the suit. This would be the answer to any question of jurisdiction that might be raised ; and, the connexion between them and their principal being dissolved, they would be regarded as individuals holding money in their hands belonging to the complainants, and a recovery of that money would follow. If the money, to recover which the suit was brought, had been actually paid into the treasury by the defendants, it is admitted that, in a suit brought by the complainants against the state treasurer to recover it, the question of jurisdiction might, perhaps,
The present case, then, and that of Osborn v. The Bank of the United States, are not “ as dissimilar as any two cases well could be.” In the latter case, the original taking of the money from the bank was tortious, being in contravention of an act of Congress which was adjudged constitutional. In the present one, the original taking was legal; but the breach of the condition of the agreement under which the state held the property, having worked a forfeiture, the possession of the defendants, as respects the complainants, is wrongful, because against láw. In the case of Osborn v. The Bank of the United States, it was adjudged that, as the taking was in violation of law, trespass might be maintained ; and, if trespass could be maintained, then an action on the case for money had and received would also lie. In the case before us, trespass could not be maintained, as the original taking was not tortious; but, if the property has reverted to the complainants, for the reason stated, an action on the case for money had and received may be maintained, to recover moneys received by the defendants, upon the assigned assets, subsequent to the forfeiture, and held by them at
Are the complainants, then, upon the case as now presented, entitled to relief? In the former case between the same parties, we held that a court of equity would not lend its aid to divest an estate for the breach of a condition subsequent, although that aid would be sometimes extended to relieve against such a condition. We cannot, therefore, decree a forfeiture in the present case; and we certainly would not, did we possess the power, as it would operate most inequitably upon the rights of the state. Can we, then, regard the property now under the control
I have not permitted myself to examine into the transactions between the state and the complainants previous to the settlement had between them. The commissioners on the part of the state may have transcended their powers; — the settlement itself may have been unwise and inequitable ; — the commissioners may have made a bad bargain for the state ; — all this may be very true. But it was in the power of the state to have repudiated that settlement, if there was an excess of power on the part of its agents. This they did not do. On the contrary, they af
But, as the complainants ask equity, they must do equity, and place in the hands of the defendants all the property in their custody and possession, or under their control, assigned to the state by the bank. It is averred in the answer, that Messrs. Joy & Porter hold a considerable portion of the property in their hands for the bank. This property, therefore, ought to be delivered over to the defendants, and constitute a part of the fund out of which the bank is to be indemnified. The retention of the property by the bank would be inconsistent with the relief we are disposed to extend to them. Again— the bill does not aver a willingness on the part of the complainants to waive the forfeiture growing out of a breach of the condition of the agreement between them and the state. The complainants are not entitled to relief here, unless they will waive the forfeiture. They cannot insist on being indemnified, and avail themselves hereafter of the forfeiture. It may be that, having come into a court of equity for relief, they would be estopped from insisting on the forfeiture. This may, and probably would be the legal effect of the decree we are disposed to make ; but to avoid all further difficulty hereafter, there should be an express waiver. A court of equity will, however, hold the defendants as trustees.
After the opinion was delivered, a decree was entered, by the consent of parties, in substance as follows :
It is ordered, adjudged and decreed, that the defendants, Hammond, Eldredge, Adam and Hastings, are, and do stand as trustees of the complainants, and for
That the complainants do and shall have a lien thereon, to the extent, and for the amount of the damages sustained by them, by reason of the breach of the condition in said indenture;
That it be referred to one of the masters of the Court of Chancery, to ascertain and report to said Court the amount of said damages;
That said Hammond, Eldredge and Adam, (they assenting thereto,) be appointed receivers, under the direction of the Court of Chancery, by one of the masters thereof,
That, thereupon, an account shall be taken, before such master, of all the property, &c. and that, upon such account being taken, the defendants shall appear before said master and submit to an examination touching all such property, Sec. make a full discovery thereof, and, under the direction of said master, assign and convey such property, &c. to the receivers who shall be appointed to take charge thereof, for the purposes of this decree ;
That James F. Joy, and George F. Porter, the President of the complainants, shall, in like manner, appear before said master, and submit to like examinations; and that both they and the said complainants, shall, in like manner, assign, transfer and convey to said receivers any of said property, &c. which may be in their control or in the control of either of them, or in the hands of their agents or attorneys;
That the said receivers shall, under the direction of the Court of Chancery, convert said property, &c. into money, so far as may be necessary to satisfy the complainants the amount of damages reported by the master to have been sustained by them, in consequence of the breach of said condition in said indenture, and the intez-est thereon, and the costs of this suit to be taxed, and out of the proceeds of said pz-operty, &c. pay to the complainants the said damages, interest and costs;
That, having paid the same, the said receivers shall assign, convey and deliver all the remaining poi'tion of said pz-operty, Sec. to the individuals who shall, at that time, hold the offices of Auditor General, Secretary of State, and State Treasurer of the state of Michigan, or to such other persons as the Cozzrt of Chancery may designate and appoint, for the use azzd benefit of said state;
That, before availirzg themselves of the benefit of this
And that the cause and proceedings therein, and this judgment and decree, be remitted to the Court of Chancery for the First Circuit, to the intent that such further proceedings may be there had as may be necessary to carry this judgment and decree into effect.