United States v. Bank of the Metropolis, 40 U.S. 377

Mr. Justice Wayne

delivered ,the opinion of the Court.

This is an action of assumpsit brought by the United States to recovet •-the sum of twenty-seven thousand eight hundred and eighty-one dollars and fifty-seven ..cents. The defendants pleaded the general issue. On the trial of the cause, the defendants claimed credits, amounting to twenty-three thousand dollars, •exclusive of interests and costs. The items had been presented to the proper accounting officer and were not allowed. They were acceptances of the Post Office Department, of the drafts of mail contractors, and an item of six hundred and eleven dollars and fifty-two cents, called in the record “ E. F. Brown’s overdraft.”

. The jury found for the defendants, and certified there was due to them by the United States three thousand three'hundred and seventy-one dollars and ninety-four cents, with interest from the '6th March, 1838.'

The errors assigned are, that the Court refused to give to the jury the following instructions, which were asked after the evidence had been closed on both sides.

1. That upon the evidence aforesaid, the defendants are not entitled in this ^action to set off against the plaintiff’s demand, the amount of the acceptances given in evidence by the defendants, nor the amount of the overdraft of E. F. Brown.

2. If the jury believe, from the evidence, that when the acceptance of the draft of E. Porter was given by the then Treasurer of the Department, there was nothing due to Porter standing on the books of the Post Office Department, and that on the books of the Department, when the acceptance fell due there was nothing due to him; then the defendants cannot set off the amount of said acceptance against the plaintiff’s claim in this action.

3. That if the accounts of E. Porter and Reeside, as contractors with the Post Office Department, were not finally settled on the books of the Post Office Department when the present Postmaster General came into office, it was his duty to have said accounts settled; and if in such settlement there'were credits claimed by them’ as allowed by order of Mr. Barry, when Postmaster General, and entered on the journal, but not carried into these accounts in the ledger, and finally entered as credits in these accounts, which credits were for extra allowances which the said Postmaster General was not legally authorized to allow them, then it was in the power and was the duty of the present Postmaster General, to disallow such items of credit.

We will consider the instructions asked, in, connexion, and upon the merits of the case; but before we conclude will express an opinion upon the .form of the first.

It appears, that the five drafts claimed as credits were drawn on the Post Office Department by contractors for carrying the mails. That they were accepted, and were'discounted at the Metropolis Bank in the way of business.

Porter’s draft was at ninety days after date, for ten thousand dollars, payable at the Metropolis Bank to his own order, to be charged to account,- and was unconditionally accepted by R. C. Mason, signing himself Treasurer of the Post Office Department. It is admitted that he was. so.

Reeside drew four drafts. One on the 17th October, 1835, for four. thousand five hundred dollars; another on the 20th' October, 1835, for one thousand dollars; a'third on the 23d October, 1835, for four thousand five hundred dollars; and the fourth on the 28th October, 1835-, for three thousand dollars. They were payable fo his own order ninety days after date, for value received; to be charged to his account for transporting the mail, and addressed to the Postmaster General. ' The following was the form of all of them, and of the acceptances of the ■Postmaster General.

$4500. Washington City, October 11th, 1835.

Sir : — Ninety days after date, please pay to my own order, four thousand five hundred dollars, for value received, and charge to my account, for transporting the mail.

Respectfully yours, James Reeside.

Hon. Amos. Kendall, Postmaster General.

“ Accepted on condition that his contracts be complied with.”

Amos Kendall.

Porter’s draft was unconditionally accepted. It was discounted by the defendants, upon his endorsement. The Bank became the holder of it, for valuable consideration, and its right to charge the United States with the amount cannot be defeated by any equities between the drawer and the Post Office Department, of which the Bank had not notice.

When the United States, by its authorized officer, become a party to negotiable paper, they have all the rights, and incur all the responsibility of individuals who are parties to such instruments. We know of no difference, except that the United States cannot be sued. But if the United States sue, and' a defendant holds its negotiable paper, the amount of it may be claimed as a credit, if, after being presented, it has been disallowed by the accounting officers of the Treasury; and if the liability of the United States upon it, be not discharged by some of those causes which discharge a party to commercial paper, it should be allowedly a jury, as a credit against the debt claimed by the United States. This is the privilege of a defendant, for all equitable credits given by the act of March 3d, 1797. 1 Story, 464. This, and the' liability of the United States, in the manlier it has been stated, has been repeatedly declared, in effect, by this Court. It said, in the case of the United States v. Dunn, 6 Peters, 51, “ the liability of parties to a bill of exchange, or promissory note, has been fixed on certain principles, which .are essential to the credit and circulation of such paper. These principles originated in the convenience of commercial transactions, and cannot now be departed from.” From the daily and unavoidable use of commercial paper by the United States,-they are as much interested as the community at large can be, in maintaining these principles.

It was held, in the case of The United States v. Barker, 4 Wash. C. C. R. 464, that the omission of the Secretary of the Treasury, for one day, to give notice of the dishonour of bills, which .were purchased by the United States, discharged the drawer. And this Cpurt said, when that case was brought before it, there was no right to recover; on account of the neglect in giving notice after the return of the bills. 12 Wheaton, 561. That, and other cases like it, show how rigidly those principles have been applied in suits on. bills and promissory notes, in which the United States was a party. The acceptance of Porter’s draft was unconditional, and there is nothing in the evidence to discharge the acceptor. There is neither waiver, express or im.plied, of his liability.' There was no understanding nor communication concerning it between the Bank and any officer of the Post Office Department, before it was discounted. The Bank advanced the money, which it was the object of the bill to obtain. It cannot be doubted, the acceptance was given for that purpose. The.want of consideration then, between' the drawer and the acceptor, can be no defence against the.right of the indorsee, who gave a valuable consideration for the bill.

It does not matter how the drawer’s account stood. Whether he was a debtor or a creditor of the Department; whether the Bank knew one or the other. An unconditional acceptance was tendered to it for discount. It was not its duty to inquire how the account stood, or for what purpose the acceptance was made. All it had to -look to was the genuineness of the -acceptance, and the authority of the officer to give it. The .rule is, that a want of consideration between the drawer and acceptor is no defence against the right of a third party, who has given a consideration for the bill, and this even though the acceptor has been defrauded by the drawer; if that be not known by such third party, before he gives value for it.

The evidence then, concerning Porter’s account, was immaterial and irrelevant to the issue. It cannot affect the rights of the Bank,, and did’not lessen the obligation of the Department to pay the acceptance when it became due..

But the evidence does not show- that any thing was due by Porter When the draft was accepted, or when it came to maturity. Mason, the witness, says, “ that in the interim a sufficient sum had been raised and carried to the credit of Porter, to pay the draft; but that he had also, within the dates, been charged with the amount of a draft, drawn upon him by the Postmaster at Mobile, accepted by him,, which draft was payable in 1833, and that he was charged with failures and forfeitures incurred as contractor, in 1833; which charges were made by order of Mr. Barry, their Postmaster General. It was certainly right to debit Porter with these charges, .if they were due by him; but that did not change the relative rights and obligations of the Bank and the Department upon his bill. If either are to lose by Porter, shall it be that party, who was bound to know the state of the account, before it gave an unconditional acceptance, for the purpose of accommodating its own agent; or the other, who placed faith in the acceptance, advanced the mone j upon it, which it was intended to raise; and who could not have learned what was the state of Porter’s account, as it is proved that the charges which it is now said should have priority of payment over the bill were not made against Porter until after his bill, had been accepted. Certainly, the loss should fall upon the first. It cannot be otherwise, unless it would be affirmed that an acceptor may claim to be discharged on account of his own negligence, and that having induced a third party to advance money upon his acceptance, he shall be permitted to intervene, between himself and the endorsee of the paper, a debt due to him by the drawer. The evidence offered to invalidate this credit was done from ignorance of the legal consequences incurred by such an acceptance. In such a case, the bank rightfully looked to the United States for payment of this bill; and if Porter owes any thing for forfeitures incurred as contractor, or on account of - the Mobile draft, the United States must look to him. There is no proof on the record, however, of any thing’ being due by Porter on those accounts;. and we do not intend to express any opinion upon his ^liability, or the rights of the United States, in respect to them, one way or the other.

What are the merits of the case upon Reeside’s drafts.

They were drawn on the Postmaster General, at'ninety days, payable to the, order of the drawer, and were to be chargéd to his account for transporting the mail. They were “ accepted on condition that his contracts be complied with.” This is of course as binding as an absolute acceptance, if the condition has been performed.

What is the proof of performance, and how- shall this conditional acceptance be ■ construed ? Mason, the witness, says, “ Reeside, in fact, performed the services for which he was ■ contractor, in the year 1835; and the money which he earned upon his contracts wás applied, to an extent exceeding the amount due upon his drafts, to the extinguishment of balances created against him, by recharging him with sums of money which had been allowed to him by Mr. Barry, the former Postmaster General, as contractor for carrying the mail, by giving him credit therefor in a general account current on the journal, but not entered in the ledger, where his accóunt remained unsettled wdi'en the present Postmaster General came, into office.” It is said,(this does riot cover the condition of the acceptance, because Reeside stipulated, by his bond,. to pay forfeitures, and repay ádvances; and that he owed the Department on .both accounts, when these acceptances. werp given; and that iii thife sense his contracts were not complied with. If .this be so, in one sense the contracts would not be complied with: bu,t is that the construction which should be put upon such a condition, when the subject matter to which it relates is considered ?

If one purpose making a conditional acceptance, only, and commit that acceptance to writing, he should be careful to express the condition therein. He cannot use general terms, and then exempt himself from liability, by relying upon .particular facts which have already happened, though they are connected with the condition expressed. Why? .Because, the particular fact is of itself susceptible of being made a distinct condition. This case furnishes as good an illustration of the rule as any other can do. ‘Instead of the words being used, “accepted on condition that his contracts be complied with,” cOUld it not have been as easily said, accepted on condition that forfeitures already incurred shall be paid, and that advances made shall be refunded. This would have conveyed a very different meaning; and. would have put the Bank, when the drafts were offered to it for discount, on inquiry. If they had been discounted without inquiry, it would have been done at the risk tha^the earningsupon the contracts, and such as might be earneq- between the date of the acceptances and the times of payment, would be enough to pay forfeitures, repay advances, and’ to take up the bills. It matters not what the acceptor meant by a cautious and precise phraseology, if it be not éxpressed as a condition. And when we are told, as we are in this case, by the person making these acceptances, that the form of words was devised expressly for that purpose, meaning for the purposes of having forfeitures paid and advances refunded, and to avoid promising to pay any thing to the order of contractors so long as any thing should be due from them to the Department; we think it will be admitted that the purpose explained is larger than the condition expressed., And from the passage in the evidence just cited, how just does the rule appear which has been, laid down by the Court, that, in the case of acceptances of commercial paper, that which can be made a distinct condition must be so expressed; nor can any thing out of the condition be inferred, unless it be in a case where the words used are so ambiguous as to make it necessary that parol evidence should be resorted to, to explain them. Then the onus of proof would be on the acceptor, and the proof would be of no avail if the holder or any person under whom he claims, took the bill without notice of such conditions and gave a valuable consideration for it. The error in this case arose from the acceptor supposing that the defendants did know, and if they did not, they were bound upon such -an. acceptance to inquire into the stipulations and conditions of Reeside’s .contracts before they discounted’the bills; and it is said they did not use due diligence to acquire information.” The objection then implies that information of these forfeitures and advances'could have been given, and that it was not given when these acceptances were made. This make's it, then, a question of due diligence between the acceptor and the defendants, as to his obligation to communicate what he knew; and their want of caution in not making .the inquiry.

We think-it will be conceded to be a general principle, that one having knowledge of particular facts upon which he intends to rely to exempt him from a pecuniary obligation, about to be contracted with another — of which facts that other.is ignorant, and can only learn them from the first, or from documents in his keeping — that the fact of knowledge raises 'the obligation upon him' to tell it. This would be the law in such a case, and it is in this case. Inquiry by the defendants would, at most, have resulted in obtaining what was already known to the acceptor. He held the contracts: he knew, or should have known, officially the state of the accounts betv/een the contractor and the Department, and when he conditionally accepted his drafts, which were to be charged to his account for transporting the mail; as his liability to pay them would occur in ninety cl ays, it was but reasonable that he should have said in plain terms, when giving his acceptances, “If the earnings of the contractor from this time to the maturity of the draft, shall be sufficient to pay what he owes, and the debt he may incur until then, then these- drafts will be paid.” This would have been a condition about which there would have been no mistake.

But, further, if two persons deal in relation to the executory contracts of a third; as these contracts were; and one of them being the obligee induces the other to advance.money to the obligor, upon “condition that his contracts be complied with;” and he knows that forfeitures have been already incurred by the obligor, for breaches of his contract, and does not say so; shall he be permitted afterwards to get rid of his liability, by saying to the person-making the advance, “I cannot pay you, for when I accepted there was already due to me from the drawer of the bill more than I accepted for. I had knowledge of it then, and so might you have had if you had made the inquiry? but you did not choose to inquire; so I will pay myself first, because my acceptance was on condition that his contracts be complied with?”

Such is the case before us as it was presented by the argument; and we cannot doubt it will be thought decisive that it was the duty of the acceptor, in this instance, to communicate what he knew of Reeside’s account,-if he had any conversation with the defendants before the drafts were discounted, and that it was not the duty of the defendants -to inquire. It cannotv he answered by saying the words of the acceptance were intended to provide for what might exist, but what was not then known, or for breaches of the contracts which had already occurred, but which had not been charged with a penalty for eithejr would be an admission that inquiry by the defendants when the a'ccept anees were made, could not have resulted in gétting the informa- • tion at the Department.

But, again, will the terms of the acceptance admit in any way of retroactive construction ? The words must be taken according to the ordinary import of them. They are “ accepted on condition that his contracts be complied with.” Can there be compliance with an executory contract, but in future, if breaches have already happened. Supposing no breaches to have occurred, necessarily implies such as may occur in future, and subsequent compliance. If both past and'future breaches, then, are, as contended for, to be comprehended within the condition of this acceptance, why may not the condition be extended to such as may happen-after the maturity of the drafts, as well as to such as had occurred before they were accepted ? A literal interpretation must lead to both, and that will not be contended for. But. the argument is, that the defendants should have inquired' into the “ stipulations of the contracts and the extent of the .condition;” and it is said, “the Bank would have been informed, that the Department expected Mr. Reeside to renew his drafts until the accumulation of his current pay would be sufficient to meet them; and had his pledge.to take them up himself, if earlier payment should be required.” Be it so. Can there be a plainer admission than there is in the preceding sentence, written by the acceptor, that it is necessary to go otxt of the condition of the acceptance to ascertain his meaning, and that his construction rests upon facts, known by himself and Mr. Reeside, which the defendants could not have known but from one or the other of them ? facts; out of the condition, and which could alone become a condition by being so expressed. Again, it is takep for granted.in the argument, if the defendants had inquired into the stipulations of the contracts and thé bond, that they would have been informed of the forfeitures which had been incurred'. But that would not follow. . Before such knowledge could have been obtained, it would have been necessary to take one step further beyond the condition — an inquiry into the accounts. Where shall such .construction stop, if it be allowed at all. The' law does not permit a conditional acceptance to be construed by any thing extraneous to it, unless where the terms used are so ambiguous that it cannot be otherwise ascertained.

We will suppose, however, that the stipulations of Reeside’s contract, and' his bond, had been known to the defendants. Might they not very justifiably have concluded, that his drafts were accepted to aid him with an advance to fulfil his engage-' ménts ? The bond in evidence, shows that a necessity for advances was contemplated. It had been the habit of the Department to make them to contractors. Its exigencies," it is said, required advances to- be made. The witness, Mason, says, “From the year 1830, the pecuniary affairs of the Department were much deranged, and it was frequently unable to pay debts due by it to contractors. Under such circumstances, the Department was in the practice of giving to contractor acceptances for sums less than was actually standing to their credit, uncondition-. ally; and such acceptances were always taken up at maturity, prior to May, 1835. That occasionally, and with the special approbation of the Postmaster.General, acceptances were- given upon the faith of existing contracts, conditional upon, the performance of the contracts, which were understood to become absolute, if the contractor performed the services stated in the contract.” The defendants,'in the year 1835, held acceptances of the same character, for more than seventy thousand dollars, all of which were under protest for non-payment, but subsequently paid' prior to the institution of this suit, except those in dispute in this case. The witness further says, the Bank of the Metropolis, and other banks in the city of Washington and elsewhere,, have been, for many years, in the practice of discounting such acceptances. That it was often done for the accommodation of the Department, often for the accommodation of the drawer, and frequently of both. This testimony brings the Department and the Bank in connexion upon acceptances of the former for contractors ; shows the course of business upon them; and aids to give a proper construction to the acceptances under consideration.When it is remembered, also, that these acceptances were given to renew others of the Department, which were overdue, .we think it cannot be doubted, that the terms, “accepted on condition that his contracts be complied with,” cannot retroact to embrace forfeitures which had been incurred, and to refund advances said to have been made before the date of these acceptances. . The argument .upon this point was made upon the false assumption that there had been a communication between the Postmaster General and the defendants concerning, these acceptances; before they were discounted; or that there was an' obligation upon the part 01 the defendants to make an inquiry into the state of Reeside’s- contracts, and his fulfilment of them, because the acceptances were conditional. It did not exist here, nor does it in any case of a conditional acceptance. The acceptor is bound by his contract as it is expressed, and so it mav be negotiated, without any further inquiry.

Having fully canvassed the argument upon the point of the obligation of the defendants to inquire into the condition of the acceptance; we turn, for a moment, to the case as it is shown to be by the evidence.

Reeside’s earnings between the date of the acceptances and the time for the payment of them, were not applied to pay forfeitures, or refund advances. They were exhausted by recharging him with sums of money, which Mr. Barry had .allowed to him as contractor for carrying the mail, which were credited in the journal, but not entered into the ledger. That they were not posted, cannot affect Reeside’s right to such allowances; and something more must appear than the testimony in this case discloses, before it can oe admitted, that credits given by Mr. Barry were legally withdrawn by his successor. There is no evidence in this cause to impeach the fairness and legality of the allowances credited by Mr. Barry; no proof that Reeside had incurred forfeitures, or that advances had been' made to him.. Proofs should have been given, if it was intended to justify the recharges for the causes stated. No. attempt was made to do so. The allowances, then, are credits in Reeside’s account, which file defendants may use to prove his performance of the conditions of the acceptance; and they .do show performance, ás the amount earned would have paid his drafts if it hail not been diverted.

- The third instruction asked the Court to say, among other things, if the credits given by Mr. Barry, were for extra allowances, which the said Postmaster General was. not legally authorized to allow, then it was the duty of the present' Postmaster General to disallow such items of credit. The successor'of Mr. Barry had the same power, and no more, than his predecessor, and the. power of the former did not extend to the recall of credits or allowances made by Mr. Barry, if he acted within the scope of official authority given by law to the head of the Department. This right in an incumbent of reviewing a predecessor’s decisions, extends to mistakes in rriatters of fact arising from errors in calculation, and to cases of rejected claims, in which material testimony is afterwards discovered and produced. But if a credit has been given, or an allowance made, as these weré, by the head of a Department, and it is alleged to be an illegal allowance, the judicial tribunals of the country must be resorted to, to construe the law under which the allowance was made, and to settle the rights between the United States and the party to whom the credit was given. . It is no longer a case between the correctness of one officer’s judgment and that of his successor. A third party is interested, and he cannot be deprived of a payment on a credit so given, but byth.e intervention of a Court to pass upon his right. No statute is necessary to authorize the United States to sue in such a case. The'right to sue is independent of statute, and it may be done by the direction of the incumbent of the Department. The act of 2d July, 1836, entitled “An act to change the organization of the Post Office Department,” is only affirmative of the antecedent right of the Government to sue, and directory to the Postmaster General to cause suits to be brought in the cases mentioned in the 17th section of that act. It also excludes him from determining, finally, any case.which he may suppose to arise under tha't section. His duty is to cause a suit to be brought. Additional allowances, the Postmaster General could make under the 43d seqtion of the act of March 2d, 1825, (3 Story, 1985;) and we presume it was because allowances were supposed to have been made contrary to that law, that the 17th section of the act of 2d July, 1836, was passed. In this last, the extent of the Postmaster General’s power in respect to allowances, is too plain to be mistaken.

We cannot say that either of the sections of the acts of 1S25, and 1836. just alluded to, covers the allowances made by Mr. Barry to Reeside. But if the Postmaster General thought they did, and that such a defence could have availed against the rights of the Bank to claim these acceptances, as credits in this suit, the same proof .which would have justified a recovery in an action by the United States, would have justified the rejection of then? as credits when they are claimed as a set-off.

We pass to the credit claimed, and called E. F. Brown’s overdraft. But why it is so called, we do not know; for certainly no overdraft occurred when he checked alone upon the contingent fund of the department deposited to his credit in the Bank. Seven thousand and seventy dollars and twenty-four cents, on the 30th of April, 1835, Were deposited to his credit. By 7th of June, he had drawn of that sum- three thousand and seventy-six dollars and ninety-seven cents. Then the Postmaster General directed the Bank not to pay Brown’s checks, unless they were approved by Robert Johnson, the Accountant of the Department. It is ■ in proof, that no check of Brown’s was afterwards paid without Johnson’s approval. On the 2d of' December following, the original deposit to Brown’s credit was drawn out in his checks, approved by Johnson, and it was found there had been an overdraft of something over six hundred dollars.- We do not say, that an overdraft out of the Bank by authorized officers of the United States, is in any case chargeable to the United States, unless it can be shown that the money overdrawn has been applied to the use of the United States: but in the present instance, wé think no proof of such application was necessary, and we cannot resist the conclusion, that the defendants are, in equity, entitled to this credit, for the proof is, that on the day that the overdraft was known, the Postmaster General wrote a letter to the Cashier of the'Bank, stating that “ the contingent fund of the Department was exhausted, but the -public service requires that a number of bills chargeable to that appropriation, shall be paid sooner than the usual sum can be obtained from Congress; I therefore request the favour of your Bank, to pay such bills against the Department, of that character, as may be presented, with the certificate that the amount is allowed, signed by Robert Johnston, Accountant of this Department.” The request was complied with, and the Bank .advanced until the 14th of May, IS36, more than six thousand dollars, to pay claims on the. contingent fund. In this case, as in those of more humble dealings,' the course of business between parties must be used when it can apply to explain their understanding of past transactions. Nor can the inference be resisted, that when the Postmaster General, discovered the contingent fund had been overdrawn, and' requested that other overdrafts might be made on the same account, that it was an admission of the correctness of the first. We think, then, that the United'States was a debtor to the defendants for Porter’s draft, and Reeside’s drafts, and for the overdraft on the contingent fund, principal, interest, and costs.

But it is said, though the credits claimed by the defendants shall be found to be due by the United States, they cannot be set off in this suit. This was the first instruction asked, and refused by the Court.

It is tirged, that to allow them as credits in this suit is, in effect, to permit, money to be taken from the Treasury, otherwise than it is directed to be disbursed by law. That the money previously held by the defendants had been passed, to the account of the Treasurer of the United States by direction of the Postmaster General,' in conformity with the act of the 2d of July, 1836. 4 Story, 2464. That when the defendants complied with the letter of instruction, written to them by the Postmaster General, on the 16th of Julv, 1836, and transferred the money then on deposit to the credit of the Department, to the Treasurer of the United States, for the service of the Post Office Department; and when they consented to receive future deposits according to a form sent, and to transact the business according to the regulations contained in the letter of the 16th of July, 1836; that the . defendants cannot. legally charge their claims against that account, by way of set-off in this suit.

To the foregoing'objections, a brief but conclusive answer maybe given. That is certainly the. Treasury of the United States where its money is directed by law to be kept: but if those whose duty it is to disburse appropriations made by law, employ, or are permitted by law to employ, either for safe keeping, dr more convenient disbursement, other agencies, and it shall become necessary for the United States to sue for the recovery of the fund, that the defendant in the action may claim, against the demand for which .the action has been brought, any credits to which he shall prove himself entitled to, if they have been previously presented to the proper accounting officers of the Treasury, and been rejected. Such, is the law, as it now stands. Tiffs right was earlv given by an act of Congress to all defend ants in suits brought by the United States. 1 Story. It has been repeatedly before this Court. The decisions upon it need not be cited. They apply to this case. The transfer of the deposit to the Treasurer of the United States; the letter of the Postmaster General directing it to be done; his regulations for keeping the account, and for disbursing it,' were directory to the defendants; and their compliance with such directions, was an acknowledgment that the Postmaster General had the right to give them, as the conditions upon which, they were to continue the depository of the fund. But it cannot- be inferred, either from the act of 2d of July, 1836, requiring that when the revenues of the Post Office Department have been collected, that they-shall be paid, under the direction of the Postmaster General, into the Treasury of the United States; or because appropriations for the service of the Department, shall be disbursed by the checks of the Treasurer endorsed upon warrants of the Postmaster General,and countersigned by the Auditor for thePost Office Department, under the words “ registered and charged;” or from the declaration in the Postmaster General’s letter to the defendants, that no other credit, set-off, or deduction wilbbe admitted in this account. It cannot be inferred, that the defendant's accepted the Postmaster General’s letter as a contract to surrender the right secured to them by the statute, to claim credits in a suit brought against them by the United States; or that it imposed upon them any legal obligation not- to do so.

From the previous and contemporaneous correspondence between the Bank and the Postmaster General, concerning these drafts, it is clear such was not the apprehension of the defendant when the account was opened with the Treasurer of the United States, in compliance with the Postmaster General’s letter. That was done in compliance with the law, changing entirely the fiscal arrangements of the Department; and for that purpose the Postmaster-General was the proper organ to direct it to be done;’but any condition in that letter not required by the act of Congress,under which he was acting, though officially made, is rather an evidence of what he wished to do, than a conclusion that he had the power to impose it; or that the defendants had consented to look to Congress for the reimbursement of the debt due them, and not to the Courts of justice. When the account was changed to the Treasurer of the United States, there was a large balance on deposit to the credit of the Post Office Department. The fund, however, was not the less that of the United States, in the one case or the other. The change, then, made no difference as to the ownership of the lund, in their 'right to retain, if the defendants had any right at all to retain it for their debt. They had been dealing with the executive branch of the Government in a matter of money, and could not be turned to the Legislature without their consent to ask it to do as a favour, what the judiciary could settle as a right. If the defendants had supposed such was to be -the consequence of carrying the fund to the Treasurer’s account, it is manifest from the evidence in the case, that it would not have been done. That they did not do so,'it is to be inferred also from the evidence arose from an indisposition to enforce a right until every effort had been made to obtain it by amicable adjustment; and from an indisposition to embarrass.a Department which had been severely pressed, and was then just beginning to be relieved. The Postmaster General says, in his.letter of March 19th, 1838, that, “excepting the refusal, in common with other banks, to pay the warrants of this Department in gold and silver, or an equivalent, commencing in May last, and the seizure of both a general and special deposit of moneys in the Treasury to meet alleged claims, under the circumstances exhibited in the annexed papers, the Bank of Metropolis has faithfully discharged its duties as a deposit bank for this Department.” The circumstances alluded to are thbse which have been the subject of comment in this case; and it is our opinion, that they confirm the right of the defendants to the credits claimed. There was no error, then, in the Court not giving the instructions asked for, and the judgment is affirmed.

It is proper for us to say, however, if the law and the merits of the case were not with the defendants, that the Court might well have refused to give the first instruction, from the manner in which it is asked. After the evidence had been closed on both sides, the Court was asked to say, “ that upon the evidence aforesaid, the defendants. are not entitled, in this action, to set off against the plaintiffs’ demand, the amount of acceptances aforesaid, so given in evidence by the defendants, nor the amount of ■the overdraft of E. F. Brown.” It raises all the. issues, both of law .and fact, in the case, and requires the Court to adjudge the case for the plaintiffs. This the Court could not do as there were contested facts in the case, which it was the province of the jury to decide. The Court could only have said, alternatively, what was the law of the case, accordingly .as the j ury did or did not believe the facts;' and this, it will be admitted, would have been equiválent to a refusal of the instruction. When instructions are asked, they should be precise and certain, to a particular intent; that the point,, intended to be raised may be distinctly seen by the Court, and that error, if one be made, may be distinctly assigned.-

This cause came on to be heard on, the transcript of the record from the Circuit. Court of the United States, for "the District of Columbia, holden in and for the county of Washington, and waa argued by counsel: on consideration whereof, it is now here ordered and adjudged by this Court, that the judgment of the said Circuit Court in this cause be, and the same is herebyj. ffirmed.

Case Details

Case Name: United States v. Bank of the Metropolis

Court Name: Supreme Court of the United States

Date Published: Mar 18, 1841

Citations: 40 U.S. 377; 10 L. Ed. 774; 15 Pet. 377; 1841 U.S. LEXIS 275

Court Abbreviation: U.S.