# United States v. Johnston (124 U.S. 236)/Opinion of the Court

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* Case Syllabus
* Opinion of the Court
United States Supreme Court
124 U.S. 236
United States v. Johnston
By the act of March 13, 1863, providing for the collection of abandoned property, it was made lawful for the secretary of the treasury, as from time to time he should see fit, to appoint a special agent or agents to receive and collect all abandoned or captured property-other than property used, or intended to be used, for carrying on war against the United States-in any portion of any state or territory designated as in insurrection against the lawful government of the United States by the president's proclamation of July 1, 1862. The second section provided that 'any part of the goods or property received or collected by such agent or agents may be appropriated to public use on due appraisement and certificate thereof, or forwarded to any place of sale within the loyal states as the public interests may require; and all sales of such property shall be at auction to the highest bidder, and the proceeds thereof shall be paid into the treasury of the United States.' Id. The third section directed the secretary to cause a book or books of account to be kept, showing from whom such property was received, the cost of transportation, and the proceeds of the sale thereof. The owner was given the right, within a prescribed period, to prefer his claims to the proceeds in the court of claims, and on proof of his right to the same, and that he had not given any aid or comfort to the Rebellion, 'to receive the residue of such proceeds, after the deduction of any purchase money which may have been paid, together with the expenses of transportation and sale of said property, and any other lawful expenses attending the disposition thereof.' 12 St. 820. But the act of July 2, 1864, greatly enlarged the powers of the secretary of the treasury in reference to captured and abandoned property. The first section authorized sales of such property, under the act of 1863, to be made 'at such places, in states declared in insurrection, as may be designated by the secretary of the treasury, as well as at other places' authorized by the original act. 13 St. 375. In addition to the property to be received, collected, and disposed of as provided in the act of 1863, the agents, approved by the secretary, were required to take charge of and lease the abandoned lands, houses, and tenements within the districts therein named, and provide, in such leases or otherwise, for the employment and general welfare of all persons, within the lines of national military occupation in the insurrectionary states, formerly held as slaves, who are or shall become free. Section 2. It was also provided that all moneys arising from the leasing of abandoned lands, houses, and tenements, or from sales of captured and abandoned property, collected and sold in pursuance of the act of 1863 or of the act of 1864, 'shall, after satisfying therefrom all proper and necessary expenses, to be approved by the secretary of the treasury, be paid into the treasury of the United States; and all accounts of moneys received or expended in connection therewith shall be audited by the proper accounting officers of the treasury.' Section 3. By the eleventh section of the same act, it is provided that 'the secretary of the treasury, with the approval of the president, shall make such rules and regulations as are necessary to secure the proper and economical execution of the provisions of this act, and shall defray all expenses of such execution from the proceeds of fees imposed by said rules and regulations, of sales of captured and abandoned property, and of sales hereinbefore authorized.'
It is quite clear that, while the approval of the president was made essential to the validity of all rules and regulations in relation to captured and abandoned property, the entire administration of the system devised by congress for the collection of such property within the insurrectionary districts, and its sale thereafter, was committed to the secretary of the treasury. Upon him alone was imposed the responsibility, in the first instance, of making rules and regulations for the 'proper and economical execution' of the statutes in question, through agents whom he should designate. Congress was aware of the unsettled condition of that part of the country dominated by the military power of the insurrectionary government, and recognized the necessity of investing some one officer with full authority to decide what expenses were fairly chargeable against the proceeds of captured and abandoned property. Such authority was conferred upon the secretary of the treasury, subject to no other restriction than that the expenses charged upon the proceeds of sales be 'proper and necessary,' and be approved by him. But no rule was prescribed for his guidance in determining what expenses were to be regarded as of that character; for the reason, perhaps, that, as each collection and sale of captured and abandoned property must depend upon its special circumstances, it was not practicable to establish a rule that would control every case. As no expenses could be charged against the proceeds of any sale except upon the approval of the secretary of the treasury, and as his discretion must have been exercised with reference to the special facts of each case, his approval of an account of expenses in relation to the collection and sale of any particular lot of captured and abandoned property should be deemed conclusive evidence that such expenses were proper and necessary, unless it appeared that the allowance of such expenses was procured by fraud, or that the expenses were incurred in violation of some positive statute, or of public policy. It is impossible to suppose that congress intended that every such account, after being approved by the secretary, should be subject to review by some subordinate officer of the treasury, or even by the courts, and to be disallowed, merely because in the judgment of that officer, or of the courts, such expenses should not have been incurred.
It is, however, contended that the words in the third section of the act of 1864, 'all accounts of moneys received or expended in connection therewith shall be audited by the proper accounting officers of the treasury,' negative the supposition that those officers cannot disallow expenses incurred in the collection and sale of captured and abandoned property which the secretary may have approved as proper and necessary. By 'proper accounting officers of the treasur ,' in that statute, it is contended is meant the first auditor and the first comptroller. It is consequently argued that the settlement upon which the defendant relies constitutes no obstacle to the examination of the items of his accounts. The act of March 3, 1817, c. 45, § 2, (3 St. 366,) provides that 'all claims and demands whatever by the United States, or against them, and all accounts whatever in which the United States are concerned, either as debtors or creditors, shall be settled and adjusted in the department of the treasury.' By the same act, it was made one of the duties of the first comptroller to examine all accounts settled by the first auditor, and certify the balances arising thereon to the register. And among the duties of the first auditor is that of receiving and examining all accounts accruing in the treasury department, certifying the balance due on such accounts, and transmitting the same, with the vouchers and certificates, to the first comptroller for his decision thereon. These provisions have been preserved, and constitute sections 236, 269, 277, Rev. St. It is contended, in behalf of the defendant, that the accounts which the third section of the act of 1864 required to be 'audited by the proper accounting officers of the treasury' were strictly money accounts, as distinguished from property accounts; whereas the accounts of the defendant, in respect of the 483 bales of cotton in question, belong, it is insisted, to the latter class. The referee, in his opinion, says: 'What took place in this case was this: The defendant, having finished the work of his agency, was called upon by the secretary of the treasury to settle his property accounts. The defendant presented himself at the treasury department, appeared before the officers designated by the secretary for the purpose of adjusting accounts of that character, and put in a claim to be credited with the 483 bales in question. As to this he claimed that he had expended on behalf of the government, and as necessary disbursements in the execution of the duties of his agency, a sum considerably exceeding the value of the 483 bales for which he acknowledged himself liable to account. It would have been competent and proper for the secretary or the accounting officer to have treated this claim for disbursements as a money account, which would then, according to the routine of the office at that time, have gone to the first auditor for examination. That this was not done is, however, at most, an irregularity. The secretary had authority and jurisdiction, however, to settle and adjust the defendant's property account, and this he did, making this offset or allowance. He thereby necessarily passed and approved the expenses in question, both as to their nature as necessary and proper, and as to their amount; and by the statute this question was confided to his exclusive determination. Upon the basis of this adjustment of the property account, the defendant's account for commissions was duly adjusted and paid by order of the secretary. In fact, the department twice thus acted on the basis of the adjustment of the defendant's property account.'
While there is much force in this view of the case we do not deem it necessary to decide whether the accounts of defendant, in respect to the 483 bales of cotton, were required by the statute of 1864 to be audited by the first auditor, and transmitted to the first comptroller for his decision thereon. If the act of 1864 should be held to have required this, it would not follow that those officers could have disregarded the action of the secretary of the treasury in allowing the expenses in question. In auditing those accounts, they would have been bound to regard such action of the secretary as final. What was said in U.S. v. Jones, 18 How. 96, may be repeated here, as applicable to accounts which have been finally acted upon by a head of department, invested with authority in the premises. There the question was as to the right of accounting officers to review the action of the secretary of the navy in approving certain disbursements made by an officer of the navy in conformity with the orders of the secretary. This court said: 'The accounting officers of the treasury have not the burden of responsibility cast upon them of revising the judgments, correcting the supposed mistakes, or annulling the orders of heads of departments.' See McKnight v. U.S., 13 Ct. Cl. 298, 309.
But, waiving any decision as to the power of accounting officers under the act of 1864, it is sufficient for this case to say that the secretary of the treasury proceeded upon the ground that the defendant's accounts in reference to this cotton were property accounts, the settlement of which belonged to him exclusively, and that such settlement could be made by him personally, or through such of his subordinates as he might designate for that purpose. In Rice v. U.S., 21 Ct. Cl. 419, it was said by RICHARDSON, C. J., who was entirely familiar with the mode of conducting business in the treasury department, that 'while Mr. Chase was secretary of the treasury, and for some time afterwards, the money received from captured and abandoned property was merely deposited with the treasurer, and was not technically, in departmental language, 'covered into the treasury;' and so, according to the construction then given by the department, was not subject to the constitutional provision that 'no money shall be drawn from the treasury but in consequence of appropriations made by law.' Const. art. 1, § 9, par. 6. More than two and a half millions of it was paid out by Secretaries Chase, Fessenden, and McCulloch (Hodges' Case, 18 Ct. Cl. 704) without any appropriations therefor, when congress interposed, and passed the joint resolution of March 31, 1868. 15 St. 251.' By that joint resolution, it was provided that 'all moneys which have been received by any officer or employe of the government, or any department thereof, from sales of captured and abandoned property in the late insurrectionary districts, under or under color of the several acts of congress providing for the collection and sale of such property, and which have not already been actually covered into the treasury, shall immediately be paid into the treasury of the United States, together with any interest which has been received or accrued thereon.' The language of this resolution affords some evidence that congress was aware of the manner in which the several acts relating to captured and abandoned property had been executed, and did not intend to disturb what had been previously done under the practice prevailing in the treasury department.
In view of the foregoing facts the case comes fairly within the rule, often announced by this court, that the contemporaneous construction of a statute by those charged with its execution, especially when it has long prevailed, is entitled to great weight, and should not be disregarded or overturned except for cogent reasons, and unless it be clear that such construction is erroneous. Edwards v. Darby, 12 Wheat, 206, 210; U.S. v. Moore, 95 U.S. 760; Hahn v. U.S., 107 U.S. 402, 2 Sup. Ct. Rep. 494; U.S. v. Philbrick, 120 U.S. 52, 59, 7 Sup. Ct. Rep. 413.
We have said that the approval by the secretary of the treasury of an agent's account of expenses in the collection and sale of captured and abandoned property would not be conclusive, if it appeared either that such approval was procured by fraud, or that such expenses were incurred in violation of some positive statute, or in contravention of public policy. Much was said at the argument to the effect that the transactions of the defendant were based upon fraud; that he withheld or suppressed evidence that it was in his power to produce; and that what he did was calculated to debauch military officers to whom money was paid by him for the performance of services, in respect to which they were forbidde by law to accept compensation. It is only necessary to say that the findings of fact do not sustain these propositions. The record contains nothing to justify this court in holding that the defendant had been guilty of any fraud that would invalidate the settlement of his accounts with the government. Taking the findings of fact to be correct, as is our duty to do, we must assume that the payments made by the defendant, is now made, 'were made necessary by is now made, 'made, 'were made necessary by the unsettled state of the country, the great accumulation of the cotton which the railroad company was unable to transport, the danger of theft and robbery, and the interference of other agents or persons claiming to be agents of the treasury department, and of military officers;' and, in respect to what are called military payments, that they 'were all made in the bona fide belief that they were necessary to protect the interests of the United States in the cotton, to secure increased vigilance, or to prevent connivance with parties interfering with, or attempting to interfere with, the cotton.' The utmost that the record establishes is that there were irregularities, perhaps carelessness, in the final closing of defendant's account with the government. It may be that he should have been required to present more satisfactory evidence than it may be supposed from the record he did in fact present. These considerations, however, even if entitled to weight as matter of law, lose much force after the lapse of years without action upon them by the government. The defendant ought not now to be held to the same strictness of proof that might justly have been required of him when all the circumstances connected with the cotton in question could have been readily established by competent evidence. We are of opinion that no case is made by the government to invalidate the settlement of defendant's accounts. We concur with the referee when he says that 'it would be an exceedingly dangerous doctrine that settled accounts, where the United States had acted on the settlement, and paid the balance found due on the basis of that settlement, could be opened or set aside merely because some of the prescribed steps in the accounting which it was the duty of a head of a department to see had been taken had been in fact omitted; or if they could be so opened and set aside on account of technical irregularities in the allowance of expenses years afterwards, when the remedy of the party against the United States is barred by the statute of limitations, and the remedies of the United States on the other side are intact, owing to its not being subject to any act of limitation.'
The facts found being sufficient to support the judgment, it is affirmed.

## Notes

This work is in the public domain in the United States because it is a work of the United States federal government (see 17 U.S.C. 105).
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