Case Name: Walter S. Johnston, receiver of the Bank of Missouri, v. The United States
Court: United States Court of Claims
Jurisdiction: United States
Decision Date: 1881-12
Citations: 17 Ct. Cl. 157
Docket Number: 
Parties: Walter S. Johnston, receiver of the Bank of Missouri, v. The United States.
Judges: 
Reporter: United States Court of Claims Reports
Volume: 17
Pages: 157–174

Head Matter:
Walter S. Johnston, receiver of the Bank of Missouri, v. The United States.
On the Proofs.
On the 23d June, 1877, a national bank is declared insolvent and a receiver appointed. Aftenoard the Comptroller of the Currency certifies that the assets are not sufficient to pay depositors in full, hut the Treasurer insists on payment of taxes on its capital stock for the half year during which it failed. The Comptroller of the Currency refuses this. Thereupon the Treasura- charges the ■tax against moneys deposited with him by the receiver. The Secretary of the Treasury orders that the amount be not covered into the Treasury. Congress then pass the Act '3d March, 1879, which, provides that no tax shall be paid into the Treasury if it will diminish assets necessary for the full payment of all depositors. Subsequently the Secretary of the Treasmy decides that this statute is wot retroactive, and orders the moneys to be covered into the Treasury.
I.If a tax "be invalid for any reason whatever, or has been abated, and the governmenc uses money belonging to the party which it’ withholds in payment of the tax, an action in the nature of assumpsit for money had and received to the use of the claimant may be maintained.
II.A statute does not operate retrospectively if it be applied to future transactions merely because those transactions relate to antecedent events, or because a part of the requisites of its action is drawn from time antecedent to its passing.
III.When an act is passed to relieve persons from an unj ust or harsh imposition under existing law, and the statute does not affect the vested rights of individuals, but only the inchoate rights of the government, it must be held generally to relieve all impositions, though previously made, if they remain to be executed or enforced.
IY. Courts look to tlie occasion for tlie passage of an o.ct, and consider tlie -wrongs wliicli it seeks to remedy, in order to ascertain how far Congress intend to afford'relief.
Y. The Act Zcl March, 1879 (Supplmt. R. S., p. 449, § 22, eh. 125), which provides that after a national bank has become insolvent, no tax shall be assessed, collected, or paid to the United States which would diminish the assets necessary for the full payment of its depositors, and that such taxes shall be abated, applies to taxes assessed before the passage of the act but not paid when the act took .effect.
YI. The act was passed to relieve depositors from contributing to the payment of taxes assessed not upon them, but upon' the assets of the XDroprietors as a corporation. It abates the tax when the proprietors have no such assets which can be reached from which to pay the same.
YII. It is not ordinarily necessary to the consummation of payment that money received by public officers in discharge of a debt be formally covered into the Treasury; but where one public officer charges a sum of money in payment of a tax to the official account of another public officer without his consent, and takes a certificate?of deposit for it, but requests the Secretary to suspend covering it into the Treasury, and the three agree that the matter be suspended, it must be held that payment was not intended to be consummated.
VIII. The controversy between the Comptroller of the Currency and the Treasurer of the United States in relation to the taxation of insolvent banks examined and stated.
The Reporters’ statement of tbe case:
The following are the facts of this case as found by the court:
I. The National Bank of the State of Missouri, in Saint Louis, was a corporation organized under the general banking laws of the United States, with a capital stock of $2,500,000, when, on the 23d of June, 1877, the Comptroller of the Currency found the same to be insolvent, and thereupon appointed the claimant to be receiver thereof, by an instrument in writing under his hand and seal of office, of which the following is a copy:
“Treasury Department,
“Office of Comptroller of the Currency,
“ Washington, June 23, 1877.
“Whereas James T. Howenstein and Walter S. Johnston, being duly authorized and directed by me to examine the affairs of ‘ The National Bank of the State of Missouri, in Saint Louis,’ located in the city of Saint Louis and State of Missouri, have, after due examination of its affairs, reported to me that said bank is insolvent, and being satisfied the said bank is insolvent and unable to pay its just and legal debts:
“Now, therefore, I, John Jay Knox, Comptroller of the Cur rency, in pursuance of the power and authority vested in me by law, and under the provisions of section 1 of an act of Congress entitled ‘An act authorizing the appointment of receivers of national banks, and for other purposes,’ approved June 30, 1876, do hereby appoint Walter S. Johnston receiver of the ‘National Bank of the State of Missouri, in Saint Louis,’ with all the powers, duties, and responsibilities given to or .imposed upon a receiver under the provisions of the Revised Statutes of the United States which authorize the appointment of a receiver.
“In witness whereof I have hereto subscribed my name and have caused my seal of office to be affixed to these presents at the city of Washington, in the District of Columbia, the day and year first above written.
[seal.] “John Jay Knox,
“ Comptroller of the Currency?
Said claimant accepted the appointment, entered upon the discharge of his duties, and has ever since been receiver of said bank.
II. On the 24th of September, 1877, said receiver made a return to the Treasurer of the United States, of which the following is a copy of all the material parts:
“SEMI-annual return by national banes.
" Statement of the average amount of notes in circulation, of the average amount of deposits, and of the average amount of capital stocl? beyond the amount invested in United States bonds of the National Banlc of the State of Missouri, in St. Louis, for the fractional part of the six months next preceding the 20th day of June, 1877, with the duty thweon * *
“I, Walter S. Johnston, receiver of the National Bank of the State of Missouri, in St. Louis, do solemnly swear that the above account, made up from the books of said association, contains, to the best of my knowledge and belief, a true and faithful statement of the amount of duty which has accrued during the time above stated, and according to the provisions of the section aforementioned.
“Walter S. Johnston,
“ Receiver Nat. Baiik State of Mo., in St. Louis.
“Subscribed and sworn to before me this 24th day of September, 1877.
[SEAL OE NOTARY.] “EDW. P. CüRTIS,
“Notary Public.”
On the 4th of October, 1877, the Treasurer of the United States requested the receiver to amend his return by making up the average amount of capital stock and the United States bonds exempt under section 5215 Revised Statutes, and stated that, in default of such return, the only course of the Treasurer would be to proceed under section 5216 of the Revised Statutes. No other or amended return was made to the Treasurer by the receiver. The Comptroller of the Currency informed the Treasurer that the bank had no capital during the fractional part of the six months ending June 23,1877, but that the whole capital of the bank had been lost.
On the 6th of December, 1877, the Treasurer of the United States assessed against said bank the duties or taxes alleged by him to be due under section 5214 of the Revised Statutes, in respect of the half year ending June 30, 1877, as follows:
Duty on circulation. $210 67
Duty on deposits... 5,822 96
Duty on capital.,. 5, 536 24
11,569.87
Of this fact he notified the Comptroller of the Currency on that day, and requested him to pay the same from money of said bank on deposit in the United States Treasury to the credit of the Comptroller, of which there was then and afterward an amount collected and deposited by said receiver much larger than the sum so demanded, but the Comptroller refused and has ever since refused to pay the same.
III. On the 11th of January, 1878, without check, order, or authority from the Comptroller of the Currency, or from the receiver of said bank, the Treasurer of the United States charged against the deposits standing on the Treasurer’s books to the credit of said Comptroller, on account of said bank, from the collections made by the receiver, said sum of $11,569.87, and took from the Assistant Treasurer the following certificate, issued by direction of the Treasurer:
No. 9660.] “Treasury or the United States,
“ Washington, X>. 0., January 12, 1878.
“I certify that the National Bank of State of Missouri, St. Louis, Missouri, has this day deposited to the credit of the United States eleven thousand five hundred sixty-nine ^ on account of semi-annual duty levied by act approved June 3, 1861, for six months preceding 1st July, 1877, for which 1 here signed triplicate receipts.
“ $11,569.87.
“A. U. Wyman,
“ Assistant Treasurer U. 8.”
On the 14th of January, 1878, the Treasurer transmitted to the Secretary of the Treasury the original of said certificate of deposit, with the following letter:
“Treasury of the United States,
“ Washington, January, 14, 1878.
“Sir: Herewith I hand you original certificate of deposit, No. 9660, for $11,569.87, semi-annual duty assessed against the National Bank of the State of Missouri in St. Louis, Missouri, for the six months preceding the 1st day of J uly, 1877. I have the honor to request that the amount be suspended and not covered into the Treasury for the present.
“Very respectfully,
“James Gilfillan,
“ Treasurer U. S.
“Hon. John Sherman,
“Secretary of the Treasury. ”
On the 17th of January, 1878, the Comptroller of the Currency addressed the following letter to the Secretary of the Treasury: .
“Treasury Department,
“ Office of Comptroller of the Currency,
“ Washington, January 17, 1878.
“Sir: I wrote you on the 17th ultimo that the Treasurer of the United States had withheld certain moneys belonging to the ñve per cent, fund of the Third National Bank, and of the Central National Bank of Chicago, to cover the semi-annual duty of these banks, when assessed in violation of section 5234 of the Revised Stautes.
“ During the conference of the Treasurer and myself with Hon. H. F. French, Assistant Secretary of the Treasury, it was understood that the funds withheld by the Treasurer were not to be covered into the Treasury until the questions at issue in reference to taxation of insolvent banks were determined; but by recent advices from the Treasurer I am informed that certificates have been transmitted to you for the purpose of covering into the Treasury the funds of the banks referred to, and also funds belonging to the National Exchange Bank of Minneapolis.
“I desire further to state that there is to my credit in the office of the Treasurer of the United States about $43,000 in trust for the creditors of the National Bank of the State of Missouri, as appears from vouchers held by me in the form of receipts of the Treasurer of the United States, which receipts state that all of such funds have been placed to my credit, and are subject only to my chech in my official capacity.
“I am advised, however, by a letter from the Treasurer, of the 12th instant, that he has taken $11,569.87 from these funds, which are on deposit to my credit, as stated in his receipts, without my “ check in my official capacity,” and has transmitted to you a certificate of deposit for that amount in payment of semi-annual duty.
“ In the letter of the Treasurer of the United States, addressed to you on the 2.1st ultimo, he says: ‘It must be remembered that the balance to the credit of the Comptroller may at any day be withdrawn from the custody of the Treasurer and placed in that of any assistant treasurer.’
“It is evident, therefore, both from the receipts of the Treasurer and his own admissions in official correspondence with you, that this amount has been arbitrarily and illegally withdrawn from funds standing to my credit in the Treasury and subject only to my check in my official capacity.
“These various funds having been, as I have already stated, illegally withheld from the assets of the banks, or illegally withdrawn from moneys deposited by me to my credit, I have the honor to request that these various amounts be suspended and not covered into the Treasury until the question of the payment of semi-annual duty by insolvent national banks shall be determined either by the courts or by legislation now pending in Congress.
“Very respectfully,
“John Jay Knox,
“ Comptroller.
“Hon. John Shermah,
“Secretary of the Tre asury.”
On the 18th of January, 1878, the Secretary of the Treasury made the following reply:
“Treasury Department,
“ January 18, 1878.
“lion. John.Jay Knox,
“ Comptroller of the Currency:
“Sir: In compliance with the request contained in your letter of the 17th instant-, the deposits.to the credit of the Treasurer of the United States on account of semi-annual duty, below described, will not for the present be covered into the Treasury by warrant.
‘Very respectfully,
“John Sherman,
“ Secretary.
IV. The Comptroller of the Currency thereafter made the following'certificate, and on the 11th of March, 1879, addressed a letter to the Secretary of the Treasury, which herein follows said certificate:
“ Oeeice oe the Comptroller oe the Currency.
“This is to certify that the National Bank of the State of Missouri became insolvent, and ceased to do business becauseof insolvency, on the 19th day of June 1877; that said bank is still insolvent; that, from all the assets and resources of said bank, including the individual liability of its shareholders, sufficient moneys have not been realized, and will not be realized, to pay the depositors of said bank in full the amounts due them for deposits and the interests thereon; and that the tax alleged to be due from said bank for the half year ending July 1,1877, to Avit, the sum of $11,569.87, will, if paid, diminish the assets of said bank necessary to pay the depositors of said bank in full, with interest.
“I further certify that I haAe directed Walter S. Johnston, heretofore appointed the receiver of said bank, and now such receiver, to institute suit against the United States for the recovery of said, to wit, the said sum of $11,569.87, erroneously paid into tbe Treasury of tbe United States after tbe law imposing said tax bad been repealed in respect of said bank, and alter said tax bad been abated.
“John Jay Knox,
“ Comptroller.
“Treasury Department,
“ OEEICE OE COMPTROLLER OR THE. CURRENCY,
“Washington, March 11, 1879.
“Sir: Tbe act to amend tbe laws relating to “internal revenue,” approved March 3,1879, contains tbe following:
“ ‘ That whenever and after any bank bas ceased to do business, by reason of insolvency or bankruptcy, no tax shall be assessed, or collected, or paid into the Treasury of tbe United States, on account of such bank, which shall diminish the assets thereof necessary for the full payment of all its depositors, and such tax shall be abated from such national banks as are found by the Comptroller of the Currency to be insolvent, and the Commissioner of Internal Kevenue, when the facts shall so appear to him, is authorized to remit so much of said tax against insolvent State and savings banks as shall be found to affect the claims of their depositors.’
“In accordance with this provision, I have the honor to inclose herewith a schedule of the several amounts taken from the assets of the national banks named therein by the Treasurer of the United States and by him transmitted toyour office, aggregating $21,423.65, which has, on my application, been retained by you and not paid into the Treasury; and I request that the same may now be returned to him for deposit to my credit, in trust for the creditors of the insolvent national banks named in the schedule.
“Very respectfully,
“John Jay Knox,
“ Comptroller.
“Hon. John Sherman,
“Secretary of the Treasury.”
The $21,423.65 referred to in said letter of the Comptroller includes the $11,569.97 for which the Secretary of the Treasury held the certificate of deposit mentioned in the third finding, on account of the tax assessed against said National Bank of Missouri.
On the 24th of March, 1879, the Secretary of the Treasury refused to return said certificate as requested by the Comptroller of the Currency, and on the 14th of June, 1879, the same was covered into the Treasury, together with other items, by a regular covering-in warraut, in due form, as follows:
TREASURY DEPARTMENT.
To Treasurer U. S.:
Pay to the Treasurer of the United. States, or order, out of the moneys received by yon arising from miscellaneous sources, in pursuance of law, nineteen thousand seven hundred and ñfty-one dollars and fifty cents, tax on circulation, &c., ofnat’l banks, and for so doing this shall be your warrant. Given under’ my hand and the seal of the Treasury Department this 14th day of June, in the year "of our Lord one thousand eight hundred and seventy-nine, and of Independence the one hundred and third.
[seal.] John B. Hawley, Assistant Secretary.
June 17, ’79.
Countersigned: 19th.
A. G. Porter, • First Comptroller.
V. The Comptroller of the Currency directed the claimant as receiver as aforesaid to bring this action before the commencement thereof.
Upon the foregoing findings the court decides, as a conclusion of law, that the claimant is entitled to recover the sum of $11,569.87,
Mr. J. JET. Ashton and Mr. Nathaniel Wilson for the claimant:
The act operated upon the tax assessed by the Treasurer against the petitioner’s bank for the half year ending June 30, 1877, abated that tax and prohibited its payment into the Treasury; the amount was not “paid into the Treasury of the United States,” in'the true intent and meaning of the act, until it was covered into the Treasury, on the 14th of June, 1879; and having been thus unlawfully paid into the Treasury, contrary to the provisions of the act, the receiver is legally entitled to recover the amount from the government.
Independently of the question as to whether or not the money under consideration was “paid into the Treasury of the United States,” when withdrawn from the account of the Comptroller of the Cun ency, and placed to the credit of the Treasurer of the United States, on the 14th of January, 1878, the act of 1879 was a complete and effectual legislative remission of the tax, on account of which the money had been so taken by the Treasurer 5 tli at the amount of the ta x, when covered in to the Treasury, was received by the United States, charged, by virtue of that remission, with a legal liability and duty to pay it to the bank; and that this obligation is enforceable here by the receiver.
Mr. John S. Blair (with whom was the Assistant Attorney-General) for the defendants:
On the 1st of June, 1879, it was enacted—
“That whenever and after any bank has ceased to do business, by reason of insolvency or bankruptcy, no tax shall be assessed, or collected, or paid into the Treasury of the United States, on account of such bank, which shall diminish the assets thereof necessary for the full payment of all its depositors, and such tax shall be abated from such national banks as are found by the Comptroller of the Currency to be insolvent, and the Commissioner of Internal Revenue, when the facts shall so appear to him, is authorized to remit so much of said tax against insolvent State and savings banks as shall be found to affect the claims of their depositors.” (20 Stat. L., 351.)
Secretary Sherman was of opinion that the act was purely prospective and had no application to the case in hand, and this construction, we contend, is the true oue. (See United States v. Seth, 3 Or., 399, p. 413; McBioen v. J)en, 24 How., 242, p. 244; Twenty per cent. Gases, 20 Wall., 179, p. 187; Neff’s appeal, 21 Penn., 243, p. 247; Sedgwick on Statutes, p. 188 et sey.)
The disjunction of the words “assessed,” “collected,” “paid” means that if in the future a bank is declared insolvent after assessment there shall be no collection nor payment, and if after collection there shall be no payment, where the assets are insufficient to pay depositors in full.
The words “whenever and after” not only display no inconsistency with the purely prospective operation of the statute, but the use of the word “and,” instead of “or,” demonstrates such to have been the purpose.
This money had, to all intents and purposes, been paid into the Treasury on the 1st of June, 1879. Other collections under the internal-revenue laws are “paid into the Treasury” without a covering-in warrant (§ 3210).
By sections 3220 and 3446 Revised Statutes, section 6, Act of March 1, 1879 (1 Supplmt. R. S.), the Commissioner of Internal Revenue retains control over the money paid in. (See also § 5218.) No executive officer has abated the tax, nor has any decided that payment of the tax in question will diminish the assets necessary for the full payment of the tax. There is not a scintilla of evidence to satisfy the court that such is the fact, and it is difficult to see how this could be done when assets of the nominal value of nearly $1,500,000 remain in the receiver’s hands.

Opinion:
Richardson, J.,
delivered the opinion of the court:
The claimant is the receiver of the National Bank oftheState of Missouri, in Saint Louis. Ho was duly appointed on the 23d day of June, 1877, by the Comptrollerof the Currency, who then officially declared the bank to be insolvent and unable to pay its just and legal 'debts.
By the following sections of the Revised Statutes, national banks are required to pay to the Treasurer of the United States each half year, in the months of January and July, certain taxes on the average amount of their circulation, deposits, and capital stock, and it is made the duty of the president or cashier of each bank to make semi-annual returns of the average amount •of each item which is thus subjected to taxation:
" Sec. 5214. In lieu of all existing taxes, every association shall jiay to the Treasurer of the United States, in the months of January and July, a duty of one-half oí one per centum each half year upon the average amount of its notes in circulation, and a duty of one-quarter of one per centum each half year upon the average amount of its deposits, and a duty of one-quarter of one per centum each half year on the average amount of its capital stock beyond the amount invested in United States bonds.
" Sec. 5215. In order to enable the Treasurer to assess the duties imposed by the preceding section, each association shall, within ten days from the first days of January and July of each year, make a return, under the oath of its 'president or cashier, to the Treasurer of the United States, in such form as the Treasurer may prescribe, of the average amount of its notes in circulation, and of the average amount of its deposits, and of the average amount of its capital stock, beyond the amount invested in United States bonds, for the six months next preceding the most recent first day of January or July. Every association which fails so to make such return shall be liable to a penalty of two hundred dollars, to be collected either out of the interest as it may become due such association on the bonds deposited with the Treasurer, or, at his option, in the manner in which penalties are to be collected of other corporations under the laws of the United States.
" Sec. 5216. Whenever any association fails to make the half yearly return required by the preceding section, the duties to be paid by such association shall be assessed upon the amount of notes delivered to such association by the Comptroller of the Currency, and upon the highest amount of its deposits and capital stock, to be ascertained in such manner as the Treasurer may deem best.
" ¡Sec. 5217. Whenever an association fails to pay the duties imposed by the three preceding sections, the sums due may be collected in the manner provided for the collection of United States taxes from other corporations; or the Treasurer may reserve the amount out of the interest as it may become due on the bonds deposited with him by such defaulting association."
When the taxes on national banks became due and payable in July, 1877, this bank w-as no longer .in the control of its former officers, and neither the president nor cashier was in a condition to make the returns upon which the taxes were to be based, and none were made by them.
In the following month of September the receiver made ihe return which the statute requires to be made by the president or cashier, in which, after specifying the average amount of circulation and deposits, upon which the taxes assessable were $6,033.33, he set down the "averageamount of paid-up capital stock" as "none." The fact was, as the Treasurer was further informed by the Comptroller of the Currency, that the whole capital of the baiik had been lost, and that it had no capital during the fractional part of the six months ending June 23, 1877.
Notwithstanding these facts, the Treasurer demanded payment of taxes from the bank, not only upon its average circulation and deposits for the six months immediately preceding July 1, 1877^ but upon its nominal capital stock also, amounting in all to $11,569.87. This sum he requested the Comptroller of the Currency to pay, but payment was refused.
There was a large sum of money collected by the receiver from various assets of the bank deposited in the Treasury of the United States to the credit of the Comptroller, and there made subject by statute to the order of that officer alone. (Bev. Stat., § 5234.) '
On the 12th of January, 1878, the Treasurer, without any order, and against the objection of the Comptroller, charged to this deposit the whole amount of the tax so assessed, and took a certificate of deposit therefor from the assistant treasurer.
On the Í4th of January, 1878, he transmitted this certificate to the Secretary of the Treasury, with " the request that the amount be suspended and not covered into the Treasury for the present."
The efforts of the Treasurer thus to enforce payment were resisted by the Comptroller, who addressed a letter to the Secretary on the 17th of January, setting forth this objection and requesting that the amount " be suspended and not covered into the Treasury until the question of the payment of semiannual duty by insolvent national banks shall be determined either by the courts or by legislation now pending in Congress." On the 18th of January the Secretary made his reply in writing, stating that the amount would not for the present be covered into the Treasury; and it was retained by him without official action until after the passage of the Act of March 3, 1879, ch. 125, in the 22d section of which is the following provision :
" That whenever and after any bank has ceased to do business by reason of insolvency or bankruptcy, no tax shall be assessed, collected, or paid into the Treasury of the United States on account of such bank which shall diminish the assets thereof necessary for the full payment of all its depositors, and such tax shall be abated from such national banks as are found by the Comptroller of the Currency to be insolvent." (Supplmt. to Bev. Stat., 449.)
Afterward the Comptroller of the Currency found and made certificate that from the assets and resources of said bank, including the individual liability of its shareholders, sufficient moneys have not been realized, and will not be realized, to pay the depositors of said bank in full the amounts due them for deposits and the interest thereon; and that the tax alleged to be due from said bank for the half year ending July 1, 1877, to wit, the sum of $11,569.87, will, if paid, diminish the assets of said bank necessary to pay the depositors of said bank in full, without interest." This certificate was an official act of the Comptroller, and even if not conclusive of the facts certified to, it was at least prima facie evidence and is not impeached.
On the 11th of March, the Comptroller addressed a letter to the Secretary of the. Treasury calling his attention-to the new enactment and the insolvent condition of this bank, and requesting- him to return the certificates of deposit for unpaid taxes on insolvent national banks, which had been retained by him at the request of the Comptroller and the Treasurer. This the Secretary declined to do, and on the 14th of June, 1879, the same was covered into the Treasury by a regular covering-in warrañt.
The question whether or not the nominal capital stock of an insolvent national bank is subject to a semi-annual tax thereon, when the whole real capital has been lost, and nothing remains for the stockholders, and they may be liable to assessments for the payment of the debts, was not much argued on either side, and has not been considered by us. Nor have we considered whether or not the Treasurer, even if the tax claimed by him was a legal liability of the bank, had the right to charge it against the deposit to the credit of the Comptroller without the authority of that officer and against his protest.
The view we take of the case renders it unnecessary to pass upon either of these questions.
Whether the Treasurer had a right to take the money from the Comptroller's account or not, he has done so, and the Secretary of the Treasury has formally and effectively covered it into the Treasury, where it is beyond the reach of any executive officer to recover it without an appropriation by Congress. How the money reached the Treasury, whether by a right or wrong process, is immaterial. -If the defendants' claim for the tax was valid when the money was covered into the Treasury, or is valid now, they may retain the money. If the tax was and is invalid for any reason whatever, or has been abated, then the defendants have money belonging to the claimant which they cannot in equity and good conscience retain, and this action in the nature of assumpsit for money had and received to the claimant's use may be maintained.
If it be conceded that the tax in question was rightly assessed in the first instance, the only inquiry is whether or not it was abated by the act of March 3, 1879.
It is urged on the part of the defendants that the act is to be construed as prospective and not applicable to taxes assessed upon national banks declared insolvent before its passage. Admitting the correctness of tbe first part of this proposition, the second does not necessarily follow.
A statute does not operate retrospectively when it is made to apply to future transactions, merely-because those transactions have relation to and are founded upon antecedent events; or, as was said by Denman, Ch. J., in Reg. v. Whitechapel, 12 Q. B., 127, "because a part of the requisites for its action is drawn from time antecedent to its passing."
Acts relieving individuals from obligations to the government or the public, in whole or in part, without affecting the vested rights of other persons, and similar acts mitigating the punishment for offenses, as well as acts relating to the administration of the government, and generally those affecting the proceedings of courts, apply with equal force to existing cases as to those which may arise in the future. In point of fact, it is well known that most of such acts are suggested by, if not passed expressly to meet, existing difficulties, hardships, or inconveniences. Such application is not retroactive in the sense in which that term is used in the canon of construction of statutes, that an act is to be held to operate prospectively only unless the contrary appears. The vested rights of individuals are not interfered with thereby, and only the inchoate rights of the government and the public are modified. The legislative power may change or release obligations to the public at pleasure ; and when an act is passed to relieve persons from what seems to be an unjust or harsh imposition under an existing law, it must generally be held to relieve all such impositions previously made and not then consummated, but which still remain to be executed or enforced.
A remedial statute must be construed liberally, so as to afford all the relief within the power of the court, which the language of the act indicates that the legislature intended to grant. Courts will look into the occasion for the passage of such an act, and will consider the evils or wrongs which it seeks to remedy, their nature and extent, in order to determine how far it was intended that the act should reach, whether only to cases thereafter to arise, or to existing cases, or retrospectively to cases entirely passed and consummated. (Stewart v. Kahn, 11 Wall., 493; People v. Supervisors, &c., 70 N. Y., 228.)
The reason for a law is such an important element in its interpretation that Lord Coke well said, "Knowing for a certainty that the law is unknown to him that knoweth not the reason thereof." (Coke on Littleton, closing paragraph.)
The act of March 3, 1879, now under consideration, was passed for the undoubted purpose of relieving depositors in national banks from the payment of certain taxes, not assessed upon them, but upon the banks of which they are only customers; taxes which, under the pre-existing law, they would indirectly be obliged to pay when a bank is so insolvent that all its capital is gone and it has nothing left with which to pay taxes, except the money of its depositors.
These semi-annual taxes are assessed against national banks in their corporate capacity, upon their capital and business, in consideration of the franchise and benefits which the government grants to them, and for other reasons. They are expected to come out of the profits of the bank, and thus reducing the dividends of the- stockholders, they are a tax upon the proprietors of the institutions. It was never intended thus to tax the customers and creditors of the banks. When, therefore, it was found that in case of insolvency of the bank and the loss of its. entire capital, and its inability to pay its depositors in full' from all its assets, an enforcement of the taxes would result in the taxation of the depositors, the customers and creditors of the bank, this act to relieve them was passed.
No reason can be conceived why depositors of the then existing insolvent banks should not be thus relieved, as well as those of banks which should thereafter become insolvent. There is nothing in the act to require future depositors to do anything to prevent the recurrence of' the same difficulty, or to protect themselves or the government, and there was nothing which depositors in the then existing insolvent banks could have done to prevent the insolvency. Depositors of both classes were equally blameless, and this remedy would seem justly to apply equally to both, as we hold that it does.
The only remaining question is whether or not this tax had been paid before the passage of the act of March 3, 1879, since, if payment had been previously consummated, then a case did not exist to which the act could apply. The language is that "no tax shall be assessed, collected, or paid into the Treasury of the United States on account of such bank which shall di minish the assets thereof necessary for the full payment of its depositors, and such tax shall be abated from such national banks as are found by the Comptroller of the Currency to be insolvent." Therefore, taxes which had been assessed and previously paid into the Treasury of the United States were not abated by the act.
All that had been done toward payment of this tax was that the Treasurer of the United States, without the order or authority of the Comptroller of the Currency, and contrary to his express protest, undertook to charge it to the bank in the account of its money on deposit in the public Treasury to the credit of the Comptroller, and to take a certificate of deposit from the assistant treasurer for the amount. That the Treasurer did not consider this to be final payment is clear from his letter to the Secretary, in which, transmitting the certificate, he expressly requests "that the amount be suspended and not covered into the Treasury for the present." The comptroller added his request to that of the Treasurer, and in a letter to the Secretary he asked that "these various amounts be suspended and not covered into the Treasury until the question of payment of semiannual duty by insolvent national banks shall be determined either by the courts or by legislation now pending in Congress." The Secretary acceded to these requests, and wrote to the Comptroller of the Currency that the money would not be covered into the Treasury by warrant for the present.
Thus it seems to have been understood and agreed among those three officers — the Secretary of the Treasury, the Comptroller of the Currency, and the Treasurer — that the matter should be held in suspense and within their control until some future time. It was so held to a period several months after the passage of the statute referred to.
An act is not consummated where anything in relation to it remains to be done. It is not ordinarily necessary to the consummation of payment that money received by public officers in discharge of a debt to the government should be formally " covered into the Treasury" by a covering-in warrant. But in this case, where one public officer charged a sum of money in payment of a tax to the official trust account of another public officer, without his consent, took a certificate of deposit for it, and requested the Secretary to suspend covering itinto the Treasury, and those three officers agreed that the matter should be sus pended, we tliinb that payment was not intended to be consummated until the act of formally covering the money into the the Treasury was effected by the action of thé Secretary. Until the money was thus covered into the public Treasury, it was within the control of the Secretary, who might have returned the certificate of deposit to the Treasurer, to be by him canceled and annulled.
The tax in question was then, at the time of the passage of the act of March 3, 1879, a tax assessed (assuming the assessment to have been legal), but not paid, and so the statute by its express terms operated upon it to abaté it. There was, therefore, nothing due on that account from the bank when the money which the claimant now sues for was covered into the Treasury, and as the defendants retain the claimant's money without right, he may recover in this action. Judgment will be entered in his favor for the sum .of $11,569.87.